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THE 

ACQUISITIVE SOCIETY 



BY 

R. H. TAWNEY 

FELLOW OP BALLIOL COLLEGE, OXFORD; LATE MEMBER 
OP THE COAL INDUSTRY COMMISSION 



m 



NEW YORK 

HARCOURT, BRACE AND HOWE 

1920 



r\ y, ^ *^ 



.c^°^ 






COPYRIGHT, 1920, BY 
HARCOURT, BRACK AND HOWE, INC. 



V \<i k;^U 



THE QUiNN a BODEN COMPANY 
RAHWAY. N. J. 

'g)CI.A604067 



CONTENTS 



CHAPTER PAGE 

I Introductory 1 

II Eights and Functions 8 

III The Acquisitive Society .... 20 

IV The Nemesis of Industrialism ... 33 
V Property and Creative Work ... 52 

VI The Functional Society .... 84 

VII Industry as a Profession .... 91 

VIII The '' Vicious Circle '' 123 

IX The Condition of Efficiency . . . 139 

X The Position of the Brain Worker . . 161 

XI PoRRO Unum Necessarium .... 180 



The author desires to express 
his acknowledgments to the 
Editor of the Hibbert Journal 
for permission to reprint an 
article which appeared in it. 



THE ACQUISITIVE SOCIETY 



INTRODUCTORY 

It is a commonplace that the characteristic virtue of 
Englishmen is their power of sustained practical 
activity, and their characteristic vice a reluctance to test 
the quality of that activity by reference to principles. 
They are incurious as to theory, take fundamentals for 
granted, and are more interested in the state of the roads 
than in their place on the map. And it might fairly be 
argued that in ordinary times that combination of in- 
tellectual tameness with practical energy is sufficiently 
serviceable to explain, if not to justify, the equanimity 
with which its possessors bear the criticism of more 
mentally adventurous nations. It is the mood of those 
who have made their bargain v^ith fate and are content 
to take what it offers without re-opening the deal. It 
leaves the mind free to concentrate undisturbed upon 
profitable activities, because it is not distracted by a 
taste for unprofitable speculations. Most generations, it 
might be said, walk in a path which they neither make, 
nor discover, but accept; the main thing is that they 
should march. The blinkers worn by Englishmen en- 
able them to trot all the more steadily along the beaten 



2 THE ACQUISITIVE SOCIETY 

road, without being disturbed by curiosity as to their 
destination. 

But if the medicine of the constitution ought nat to 
be made its daily food, neither can its daily food be 
made its medicine. There are times which are not ordi- 
nary, and in such times it is not enough to follow the 
road. It is necessary to know where it leads, and, if 
it leads nowhere, to follow another. The search for 
another involves reflection, which is uncongenial to the 
bustling people who describe themselves as practical, 
because they take things as they are and leave them as 
they are. But the practical thing for a traveler who 
is uncertain of his path is not to proceed with the utmost 
rapidity in the wrong direction: it is to consider how 
to find the right one. And the practical thing for a 
nation which has stumbled upon one of the turning- 
points of history is not to behave as though nothing very 
important were involved, as if it did not matter whether 
it turned to the right, or to the left, went up hill or 
down dale, provided that it continued doing with a 
little more energy what it has done hitherto; but to 
consider whether what it has done hitherto is wise, and, 
if it is not wise, to alter it. When the broken ends of 
its industry, its politics, its social organization, have to 
be pieced together after a catastrophe, it must make a 
decision; for it makes a decision even if it refuses to 
decide. If it is to make a decision which will wear, it 
must travel beyond the philosophy momentarily in favor 
with the proprietors of its newspapers. Unless it is to 
move with the energetic futility of a squirrel in a revolv- 
ing cage, it must have a clear apprehension both of the 



INTRODUCTORY 3 

deficiency of what is, and of the character of what ought 
to be. And to obtain this apprehension it must appeal 
to some standard more stable than the momentary exi- 
gencies of its commerce or industry or social life, and 
judge them by it. It must, in short, have recourse to 
Principles. 

Such considerations are, perhaps, not altogether ir- 
relevant at a time when facts have forced upon English- 
men the reconsideration of their social institutions 
which no appeal to theory could induce them to under- 
take. An appeal to principles is the condition of any 
considerable reconstruction of society, because social in- 
stitutions are the visible expression of the scale of moral 
values which rules the minds of individuals, and it is 
impossible to alter institutions without altering that 
moral valuation. Parliament, industrial organizations, 
the whole complex machinery through which society ex- 
presses itself, is a mill which grinds only what is put 
into it, and when nothing is put into it grinds air. 
There are many, of course, who desire no alteration, and 
who, when it is attempted, will oppose it. They have 
found the existing economic order profitable in the past. 
They desire only such changes as will insure that it is 
equally profitable in the future. Quand le Roi avail hu, 
la Pologne etait ivre. They are genuinely unable to 
understand why their countrymen cannot bask happily 
by the fire which warms themselves, and ask, like the 
Prench farmer-general : — '^ When everything goes so 
happily, why trouble to change it ? " Such persons are 
to be pitied, for they lack the social quality which is 



4 THE ACQUISITIVE SOCIETY 

proper to man. But thej do not need argument; for 
Heaven has denied them one of the faculties required to 
apprehend it. 

There are others, however, who are conscious of the 
desire for a new social order, hut who yet do not grasp 
the implications of their own desire. Men may gen- 
uinely sympathize with the demand for a radical 
change. They may he conscious of social evils and sin- 
cerely anxious to remove them. They may set up a 
new department, and appoint new officials, and invent 
a new name to express their resolution to effect some- 
thing more drastic than reform, and less disturhing 
than revolution. But unless they will take the pains, 
not only to act, hut to reflect, they end hy effecting 
nothing. For they deliver themselves hound to those 
who think they are practical, hecause they take their 
philosophy so much for granted as to he unconscious 
of its implications, and directly they try to act, that 
philosophy re-asserts itself, and serves as an over- 
ruling force which presses their action more deeply into 
the old channels. " Unhappy man that I am ; who 
shall deliver me from the hody of this death ? '' When 
they desire to place their economic life on a better foun- 
dation, they repeat, like parrots, the w^ord ^^ Produc- 
tivity," hecause that is the word that rises first in their 
minds; regardless of the fact that productivity is the 
foundation on which it is based already, that increased 
productivity is the one characteristic achievement of the 
age before the war, as religion was of the Middle Ages 
or art of classical Athens, and that it is precisely in the 
century which has seen the greatest increase in produc- 



INTEODUCTOKY 5 

tivity since the fall of the Eoman Empire that economic 
discontent has been most acute. When they are touched 
by social compunction, they can think of nothing more 
original than the diminution of poverty, because pov- 
erty, being the opposite of the riches v^hich they value 
most, seems to them the most terrible of human af- 
flictions. Theydo not understand that poverty is_ a 
symptom and a consequence of social disorder, while the 
disorder itself is something at once more fundamental 
and more incorrigible, and that the quality in their 
social life which causes it to demoralize a few by exces- 
sive riches, is also the quality which causes it to de- 
moralize many by excessive poverty. 

'' But increased production is important." Of course 
it is ! That plenty is good and scarcity evil — it needs 
no ghost from the graves of the past five years to tell 
us that. But plenty depends upon co-operative effort, 
and co-operation upon moral principles. And moral 
principles are what the prophets of this dispensation 
despise. So the world " continues in scarcity," be- 
cause it is too grasping and too short-sighted to seek 
that ^' w^hich maketh men to be of one mind in a house." 
The well-intentioned schemes for social reorganization 
put forward by its commercial teachers are abortive, be- 
cause they endeavor to combine incompatibles, and, if 
they disturb everything, settle nothing. They are like a 
man who, when he finds that his shoddy boots wear 
badly, orders a pair two sizes larger instead of a pair 
of good leather, or who makes up for putting a bad 
sixpence in the plate on Sunday by putting in a bad 
shilling the next. And when their fit of feverish energy 



THE ACQUISITIVE SOCIETY 

has spent itself, and there is nothing to show for it 
except disillusionment, they cry that reform is imprac- 
ticable, and blame human nature, when what they ought 
to blame is themselves. 

Yet all the time the principles upon which industry 
should be based are simple, however difficult it may be 
to apply them; and if they are overlooked it is not be- 
cause they are difficult, but because they are elementary. 
They are simple because industry is simple. An in- 
dustry, when all is said, is, in its essence, nothing more 
mysterious than a body of men associated, in various 
degrees of competition and co-operation, to win their 
living by providing the community with some service 
which it requires. Organize it as you will, let it be a 
group of craftsmen laboring with hammer and chisel, 
or peasants plowing their own fields, or armies of 
mechanics of a hundred different trades constructing 
ships which are miracles of complexity with machines 
which are the climax of centuries of invention, its func- 
tion is service, its method is association. Because its 
function is service, an industry as a whole has rights 
and duties towards the community, the abrogation of 
which involves privilege. Because its method is asso- 
ciation, the different parties within it have rights and 
duties towards each other ; and the neglect or perversion 
of these involves oppression. 

The conditions of a right organization of industry 
are, therefore, permanent, unchanging, and capable of 
being apprehended by the most elementary intelligence, 
provided it will read the nature of its countrymen in the 
large outlines of history, not in the bloodless abstrac- 



INTKODUCTORY 7 

y 
tions of experts. The first is that it should be subordi- 
nated to the community in such a way as to render the 
best service technically possible, that those who render 
no service should not be paid at all, because it is of 
the essence of a function that it should find its mean- 
ing in the satisfaction, not of itself, but of the end which 
it serves. The second is that its direction and govern- 
ment should be in the hands of persons who are re- 
sponsible to those who are directed and governed, be- 
cause it is the condition of economic freedom that men 
should not be ruled by an authority which they cannot 
control. The industrial problem, in fact, is a problem 
of right, not merely of material misery, and because it 
is a problem of right it is most acute among those 
sections of the working classes whose material misery 
is least. It is a question, first of Function, and sec- 
ondly of Freedom. 



n 

EIGHTS AND FUNCTIONS 

A FUNCTION may be defined as an activity whicli em- 
bodies and expresses the idea of social purpose. The 
essence of it is that the agent does not perform it merely 
for personal gain or to gratify himself, but recognizes 
that he is responsible for its discharge to some higher 
authority. The purpose of industry is obvious. It is 
to supply man with things which are necessary, useful 
or beautiful, and thus to bring life to body or spirit. 
In so far as it is governed by this end, it is among tbe 
most important of human activities. In so far as it is 
diverted from it, it may be harmless, amusing, or even 
exhilarating to those who carry it on, but it possesses 
no more social significance than the orderly business of 
ants and bees, the strutting of peacocks, or the struggles 
of carnivorous animals over carrion. 

Men have normally appreciated this fact, however un- 
willing or unable they may have been to act upon it; 
and therefore from time. to time, in so far as they have 
been able to control the forces of violence and greed, 
they have adopted various expedients for emphasizing 
the social quality of economic activity. It is not easy, 
however, to emphasize it effectively, because to do so 
requires a constant effort of will, against which ego- 
tistical instincts are in rebellion, and because, if that 
will is to prevail, it must be embodied in some social 



EIGHTS AND FUNCTIONS 9 

and political organization, which may itself become so 
arbitrary, tyrannical and corrupt as to thwart the per- 
formance of function instead of promoting it. When 
this process of degeneration has gone far, as in most 
European countries it had by the middle of the eight- 
eenth century, the indispensable thing is to break the 
dead organization up and to clear the ground. In the 
course of doing so, the individual is emancipated and 
his rights are enlarged ; but the idea of social purpose is 
discredited by the discredit justly attaching to the obso- 
lete order in which it is embodied. 

It is not surprising, therefore, that in the new indus- 
trial societies which arose on the ruins of the old reiiime 
the dominant note should have been the insistence upon 
individual rights, irrespective of any social purpose to 
which their exercise contributed. The economic ex- 
pansion which concentrated population on the coal-meas- 
ures was, in essence, an immense movement of coloniza- 
tion drifting from the south and east to the north and 
west; and it was natural that in those regions of Eng- 
land, as in the American settlements, the characteristic 
philosophy should be that of the pioneer and the mining 
camp. The change of social quality was profound. But 
in England, at least, it was gradual, and the '' industrial 
revolution," though catastrophic in its effects, was only 
the visible climax of generations of subtle moral change. 
The rise of modern economic relations, which may be 
dated in England from the latter half of the seventeenth 
century, was coincident with the growth of a political 
theory which replaced the conception of purpose by that 
of mechanism. During a great part of history men had ' 



10 THE ACQUISITIVE SOCIETY 

found the significance of their social order in its rela- 
tion to the universal purposes of religion. It stood as 
one rung in a ladder which stretched from hell to Para- 
dise, and the classes who composed it were the hands, 
the feet, the head of a corporate hody which was itself 
a microcosm imperfectly reflecting a larger universe. 
When the Eeformation made the Church a department 
of the secular government, it undermined the already en- j 
feehled spiritual forces which had erected that sublime, 
but too much elaborated, synthesis. But its influence 
remained for nearly a century after the roots which fed 
it had been severed. It was the atmosphere into which 
men were born, and from which, however practical, or 
even Machiavellian, they could not easily disengage 
their spirits. Nor was it inconvenient for the new state^ 
craft to see the weight of a traditional religious sanction 
added to its own concern in the subordination of all 
classes and interests to the common end, of which it 
conceived itself, and during the greater part of the six- 
teenth century was commonly conceived, to be the guar- 
dian. The lines of the social structure were no longer 
supposed to reproduce in miniature the plan of a uni- 
versal order. But common habits, common traditions 
and beliefs, common pressure from above gave them a 
unity of direction, which restrained the forces of indi- 
vidual variation and lateral expansion; and the center 
towards which they converged, formerly a Church pos- 
sessing some of the characteristics of a State, was now a 
State that had clothed itself with many of the attributes 
of a Church. 

The difference between the England of Shakespeare, 



RIGHTS AND FUNCTIONS 11 

still visited by the ghosts of the Middle Ages, and the 
England which merged in 1700 from the fierce polemics 
of the last two generations, was a difference sif social and 
political theory even more than of constitutional and 
political arrangements. ■'Not only the facts, hut the 
minds which appraised them, were profoundly modified. 
The essence of the change was the disappearance of the 
idea that social institutions and economic activities were 
related to common ends, which gave them their signifi- 
cance and which served as their criterion. In the 
eighteenth century both the State and the Church had 
abdicated that part of the sphere which had consisted in 
the maintenance of a common body of social ethics; 
what was left of it was repression of a class, not the 
discipline of a nation. Opinion ceased to regard social 
institutions and economic activity as amenable, like 
personal conduct, to moral criteria, because it was no 
longer influenced by the spectacle of institutions which, 
arbitrary, capricious, and often corrupt in their prac- 
tical operation, had been the outward symbol and ex- 
pression of the subordination of life to purposes trans- 
cending private interests. That part of government 
which had been concerned with social administration, 
if it did not end, became at least obsolescent. For such 
democracy as had existed in the Middle Ages was dead, 
and the democracy of the Revolution was not yet born, 
so that government passed into the lethargic hand of 
classes who wielded the power of the State in the inter- 
ests of an irresponsible aristocracy. And the Church 
was even more remote from the daily life of mankind 
than the State. Philanthropy abounded; but religion, 



12 THE ACQUISITIVE SOCIETY 

once the greatest social force, had become a thing as pri- 
vate and individual as the estate of the squire or the 
working clothes of the laborer. There were sjDecial dis- 
pensations and occasional interventions, like the acts of 
a monarch who reprieved a criminal or signed an order 
for his execution. But what was familiar, and human 
and lovable — what was Christian in Christianity had 
largely disappeared. God had been thrust into the 
frigid altitudes of infinite space. There was a limited 
monarchy in Heaven, as well as upon earth. Provi- 
dence was the spectator of the curious machine which 
it had constructed and set in motion, but the operation 
of which it was neither able nor willing to control. Like 
the occasional intervention of the Crown in the pro- 
ceedings of Parliament, its wisdom was revealed in the 
infrequency of its interference. 

The natural consequence of the abdication of authoriy 
ties which had stood, however imperfectly, for a commonj 
purpose in social . organization, was the gradual disap-f 
pearance from social thought of the idea of purpose it- 
self. Its place in the eighteenth century was taken by 
the idea of mechanism. The conception of men as 
united to each other, and of all mankind as united to 
God, by mutual obligations arising from their relation 
to a common end, which vaguely conceived and imper- 
fectly realized, had been the keystone holding together 
the social fabric, ceased to be impressed upon men's 
minds, when Church and State withdrew from the center 
of social life to its circumference. What remained when 
the keystone of the arch was removed, was private rights 
and private interests, the materials of a society rather 



RIGHTS AND FUNCTIONS 13 

than a society itself. These rights and interests were 
the natural order which had been distorted by the ambi- 
tions of kings and priests, and which emerged when the 
artificial super-structure disappeared, because they were 
the creation, not of man, but of Nature herself. They 
had been regarded in the past as relative to some public 
end, whether religion or national welfare. Hencefor- 
ward they were thought to be absolute and indefeasible, 
and to stand by their own virtue. They were the ulti- 
mate political and social reality; and since they were 
the ultimate reality, they were not subordinate to other 
aspects of society, but other aspects of society were 
subordinate to them. 

The State could not encroach upon these rights, for 
the State existed for their maintenance. They deter- 
mined the relation of classes, for the most obvious and 
fundamental of all rights was property — property abso- 
lute and unconditioned — and those who possessed it 
were regarded as the natural governors of those who did 
not. Society arose from their exercise, through the con- 
tracts of individual with individual. It fulfilled its 
object in so far as, by maintaining contractual freedom, 
it secured full scope for their unfettered exercise. It 
failed in so far as, like the French monarchy, it over- 
rode them by the use of an arbitrary authority. Thus 
conceived, society assumed something of the appearance 
of a great joint-stock company, in which political power 
and the receipt of dividends were justly assigned to 
those who held the most numerous shares. The currents / 
of social activity d,id_n^l_ijonvergejipon_common ends, \ 
but were dispersed through a multitude of channels, 



14 THE ACQUISITIVE SOCIETY 

created by the private interests of thejjoiiividuals^j^ho 
composed society. But in their very variety and spon- 
taneity, in the very absence of any attempt to relate 
them to a larger purpose than that of the individual, lay 
the best security of its attainment. There is a mysti- 
cism of reason as well as of emotion, and the eighteenth 
century found, in the beneficence of natural instincts, 
a substitute for the God whom it had expelled 
from contact with society, and did not hesitate to 
identify them. 

" Thus God and nature planned the general frame 
And bade self-love and social be the same/' 

The result of such ideas in the world of practice was 
a society which was ruled by law, not by the caprice 
of Governments, but which recognized no moral limita- 
tion on the pursuit by individuals of their economic 
self-interest. In the world of thought, it was a political 
philosophy which made rights the foundation of the 
social order, and which considered the discharge of obli- 
gations, when it considered it at all, as emerging by an 
inevitable process from their free exercise. The first 
famous exponent of this philosophy was Locke, in whom 
the dominant conception is the indefeasibility of private 
rights, not the pre-ordained harmony between private 
rights and public welfare. In the great French writers 
who prepared the way for the Revolution, while believ- 
ing that they were the servants of an enlightened ab- 
solutism, there is an almost equal emphasis upon the 
sanctity of rights and upon the infallibility of the 



EIGHTS AND FUNCTIONS 15 

alchemy by which the pursuit of private ends is trans- 
muted into the attainment of public good. Though 
their writings reveal the influence of the conception of 
society as a s elf-a djusting mechanism, which afterwards 
became the mostcEaracteristic note of the English in- 
dividualism, what the French Revolution burned into 
the mind of Europe was the former not the latter. In 
England the idea of right had been negative and de- 
fensive, a barrier to the encroachment of Governments. 
The French leapt to the attack from trenches which the 
English had been content to defend, and in France the 
idea came affirmative and militant, not a weapon of 
defense, but a principle of social organization. The 
attempt to refound society upon rights, and rights 
springing not from musty charters, but from the very 
nature of man himself, was at once the triumph and the 
limitation of the Revolution. It gave it the enthusiasm 
and infectious power of religion. 

What happened in England might seem at first 
sight to have been precisely the reverse. English prac- 
tical men, whose thoughts were pitched in a lower key, 
were a little shocked by the pomp and brilliance of that 
tremendous creed. They had scanty sympathy with the 
absolute affirmations of France. What captured their 
imagination was not the right to liberty, which made 
no appeal to their commercial instincts, but the expedi- 
ency of liberty, which did ; and when the Revolution had 
revealed the explosive power of the idea of natural right, 
they sought some less menacing formula. It had been 
offered them first by Adam Smith and his precursors, 
who showed how the mechanism of economic life con- 



16 THE ACQUISITIVE SOCIETY 

verted " as with an invisible hand/' the exercise of in- 
dividual rights into the instrument of public good. 
Bentham, who despised metaphysical subtleties, and 
thought the Declaration of the Rights of Man as absurd 
as any other dogmatic religion, completed the new 
orientation by supplying the final criterion of political 
institutions in the principle of Utility. Henceforward 
emphasis was transferred from the right of the indi- 
vidual to exercise his freedom as he pleased to the ex- 
pediency of an undisturbed exercise of freedom to 
society. 

The change is significant. It is the difference be- 
tween the universal and equal citizenship of France, 
with its five million peasant proprietors, and the organ- 
ized inequality of England established solidly upon class 
traditions and class institutions ; the descent from hope 
to resignation, from the fire and passion of an age of 
illimitable vistas to the monotonous beat of the factory 
engine, from Turgot and Condorcet to the melancholy 
mathematical creed of Bentham and Ricardo and James 
Mill. "^ Mankind has, at least, this superiority over its 
philosophers, that great movements spring from the heart 
and embody a faith, not the nice adjustments of the 
hedonistic calculus. So in the name of the rights of 
property France abolished in three years a great mass 
of property rights which, under the old regime had 
robbed the peasant of part of the produce of his labor, 
and the social transformation survived a whole world 
of political changes. In England the glad tidings of 
democracy were broken too discreetly to reach the ears 
of the hind in the furrow or the shepherd on the hill; 



RIGHTS AND FUNCTIONS 17 

there were political changes without a social transfor- 
mation. The doctrine of Utility, though ti:enchant in 
the sphere of politics, involved no considerable interfer- 
ence with the fundamentals of the social fabric. Its 
exponents were principally concerned with the removal 
of political abuses and legal anomalies. They attacked 
sinecures and pensions and the criminal code and the 
procedure of the law courts. But they touched only 
the surface of social institutions. They thought it a 
monstrous injustice that the citizen should pay one-tenth [ 
of his income in taxation to an idle Government, but \ 
quite reasonable that he should pay one-fifth of it in 
rent to an idle landlord. 

The difference, neverthelesss, was one of emphasis 
and expression, not of principle. It mattered very little 
in practice whether private property and unfettered eco- 
nomic freedom were stated, as in France, to be natural 
rights, or whether, as in England, they were merely 
assumed once for all to be expedient. In either case 
they were taken for granted as the fundamentals upon\ 
which social organization was to be based, and about 
which no further argument was admissible. Though 
Bentham argued that rights were derived from utility, 
not from nature, he did not push his analysis so far as 
to argue that any particular right was relative to any 
particular function, and thus endorsed indiscrimi- 
nately rights which were not accompanied by service 
as well as rights which were. While eschewing, in 
short, the phraseology of natural rights, the English 
Utilitarians retained something not unlike the substance 
of them. For they assumed that private property in 



p THE ACgnsnTTE SOCIETY 

land, find tiie privsie o'WDersliip of capital, "vrere natural 

'l- ' - £:^d r£Vr liird. ixideed, a nev le.ase of life^ 

- IC' liieir C'lm ^lisf action that sc»cial weH- 

, - _ " resuli JTozn Lheir eoniiiiiied exercise. Their 

negEiiTe vaf as imponani as their positrre teaching. It 
vas a eondncTOT vhich divened the Hghtning, Behind 
their paliiical theorr, behind the practical conduct, 
vhich as alwajs. eoniin-Qes to express iheorv long after 
it has been discredited in. the world of thought, lav the 
aeeeptanee of Ehsolnte rights to prop»erTT and to eeo- 
nnrmic freedom as the nnqnestioned center of social 
Qiganization. 

The resnli of tha; atnmde v»s mamentons. The 
moirre and inspiratian of the liberal Moi'oiiesit of 
lie eighteenth eentnrT had been the attmA <m Privi- 
lege. But the creed iikkk laid esoveised Ike specter 
of agrarian fendalism k«^«riMg tOIj^ joid dkoiew 
in Prance, 'wrs impoteaii to ^Hgrm the sew ogre of 
indnstrialisiL iriici was ^zdcMng its limbs in the 
north of Z : / ^^HieB, ffanm of its ^laidjois and 

ii - ::.-. :i_ LL" -1- _ - — 3rld of 

a^' ~ - rtr and 

fr-r- _:^ : _--___ : " '- 

pj-e: T 1 -^ : z-_. 

-^ —-, i twisted 

tin th^ ~ . . "~:ijL in tiTnp- , 



tion. 



RIGHTS AXD FUXCTIOXS 19 

and master craftsmen ensliriiLed its philosopLy of free- 
dom, are in danger of beoDmiii^ fetters used hj an 
Anglo-Saxon bnsiness aristocraey to bind instirgent 
movements on the part of an immigrant and semi- 
servile proletariat. '^ 



Ill 

THE ACQUISITIVE SOCIETY 

This doctrine has been qualified in practice by par- 
ticular limitations to avert particular evils and to meet 
exceptional emergencies. But it is limited in special 
cases precisely because its general validity is regarded 
as beyond controversy, and, up to the eve of the present 
war, it was the working faith of modern economic 
civilization. ^What it implies is, that the foundation 
of society is found, not in functions,] but in rights; 
that rights are not deducible from the discharge of 
functions, so that the acquisition of wealth and the 
enjoyment of property are contingent upon the per- 
formances of services, but that the individual enters 
the world equipped with rights to the free disposal 
of his property and the pursuit of his economic self- 
interest, and that these rights are anterior to, and in- 
dependent of, any service which he may render. True, 
the service of society will, in fact, it is assumed, re- 
sult from their exercise. But it is not the primary 
motive and criterion of industry, but a secondary con- 
sequence, which emerges incidentally through the ex- 
ercise of rights, a consequence which is attained, in- 
deed, in practice, but which is attained without being 
sought. It is not the end at which economic activity 
aims, or the standard by which it is judged, but a 

by-product, as coal-tar is a by-product of the manu- 

20 



THE ACQUISITIVE SOCIETY 21 

facture of gas; whether that by-product appears or 
not, it is not proposed that the rights themselves should 
be abdicated. For they are regarded, not as a con- 
ditional trust, but as a property, which may, indeed, 
give way to the special exigencies of extraordinary 
emergencies, but which resumes its sway when the 
emergency is over, and in normal times is above dis- 
cussion. 

That conception is written large over the history 
of the nineteenth century, both in England and in 
America. The doctrine which it inherited was that 
property was held by an absolute right on an in- 
dividual basis, and to this fundamental it added an- 
other, which can be traced in principle far back into 
history, but which grew to its full stature only after 
the rise of capitalist industry, that societies act both 
unfairly and unwisely when they limit opportunities 
of economic enterprise. Hence every attempt to im- 
pose obligations as a condition of the tenure of prop- 
erty or of the exercise of economic activity has been 
met by uncompromising resistance. The story of the 
struggle between humanitarian sentiment and the the- 
ory of property transmitted from the eighteenth cen- 
tury is familiar. 'No one has forgotten the opposi- 
tion offered in the name of the rights of property to 
factory legislation, to housing reform, to interference 
with the adulteration of goods, even to the compulsory 
sanitation of private houses. ^^ May I not do what I 
Uke with my ovni ? " was the answer to the proposal 
to require a minimum standard of safety and sanita- 
tion from the owners of mills and houses. Even to 



22 THE ACQUISITIVE SOCIETY 

this day, while an English urban landlord can cramp 
or distort the development of a whole city by with- 
holding land except at fancy prices, English munici- 
palities are without adequate powers of compulsory 
purchase, and must either pay through the nose or 
see thousands of their members overcrowded. The 
whole body of procedure by which they may acquire 
land, or indeed new powers of any kind, has been 
carefully designed by lawyers to protect owners of 
property against the possibility that their private 
rights may be subordinated to the public interest, 
because their rights are thought to be primary 
and absolute and public interests secondary and] 
contingent. 

No one needs to be reminded, again, of the influence 
of the same doctrine in the sphere of taxation. Thus 
the income tax was excused as a temporary measure, 
because the normal society was conceived to be one 
in which the individual spent his whole income for 
himself and owed no obligations to society on account 
of it. The death duties were denounced as robbery, 
because they implied that the right to benefit by in- 
heritance was conditional upon a social sanction. The 
Budget of 1909 created a storm, not because the taxa- 
tion of land was heavy — in amount the land-taxes were 
trifling — but because it was felt to involve the doc- 
trine that property is not an absolute right, but that 
it may properly be accompanied by special obligations, 
a doctrine which, if carried to its logical conclusion, 
would destroy its sanctity by making ownership no 
longer absolute but conditional. i 



THE ACQUISITIVE SOCIETY 23 

Such an implication seems intolerable to an influ- 
^ ential body of public opinion, because it has been ac- 
customed to regard the free disposal of property and 
the unlimited exploitation of economic opportunities, 
as rights which are absolute and unconditioned. On 
the whole, until recently, this opinion had few antag- 
onists who could not be ignored. As a consequence 
the maintenance of property rights has not been seri- 
iously threatened even in those cases in which it is 
evident that no service is discharged, directly or in- 
directly, by their exercise. 'No one supposes, that the 
owner of urban land, performs qua owner, any func- 
tion. He has a right of private taxation; that is all. 
But the private ownership of urban land is as secure 
to-day as it was a century ago; and Lord Hugh Cecil, 
in his interesting little book on Conservatism, declares 
that whether private property is mischievous or not, 
society cannot interfere with it, because to interfere 
with it is theft, and theft is wicked. No one sup- 
poses that it is for the public good that large areas 
of land should be used for parks and game. But our 
country gentlemen are still settled heavily upon their 
villages and still slay their thousands. No one can 
argue that a monopolist is impelled by '^ an invisible 
hand " to serve the public interest. But over a con- 
siderable field of industry competition, as the recent 
Report on Trusts shows, has been replaced by com- 
bination, and combinations are allowed the same un- 
fettered freedom as individuals in the exploitation of 
economic opportunities. No one really believes that 
the production of coal depends upon the payment of 



24 THE ACQUISITIVE SOCIETY 

mining royalties or that ships will not go to and fro 
unless ship-owners can earn fifty per cent, upon their 
capital. But coal mines, or rather the coal miner, still 
pay royalties, and ship-owners still make fortunes and 
are made Peers. 

At the very moment when everybody is talking about 
the importance of increasing the output of wealth, the 
last question, apparently, which it occurs to any states- 
man to ask is why wealth should be squandered on 
futile activities, and in expenditure which is either 
disproportionate to service or made for no service at 
all. So inveterate, indeed, has become the practice 
of payment in virtue of property rights, without even 
the pretense of any service being rendered, that when, 
in a national emergency, it is proposed to extract oil 
from the ground, the Government actually proposes 
that every gallon shall pay a tax to landowners who 
never even suspected its existence, and the ingenuous 
proprietors are full of pained astonishment at any one 
questioning whether the nation is under moral obliga- 
tion to endow them further. Such rights are, strictly 
speaking, privileges. For the definition of a priv- 
ilege is a right to which no corresponding function is 
attached. 

The enjoyment of property and the direction of in- 
dustry are considered, in short_, to require no social 
justification, because they are regarded as rights which 
stand by their own virtue, not functions to be judged 
by the success with which they contribute to a social 
purpose. To-day that doctrine, if intellectually dis- 
credited, is still the practical foundation of social or- 



THE ACQUISITIVE SOCIETY 25 

ganization. How slowly it yields even to the most 
insistent demonstration of its inadequacy is shown by 
the attitude which the heads of the business world 
have adopted to the restrictions imposed on economic 
activity during the war. The control of railways, 
mines and shipping, the distribution of raw materials 
through a public department instead of through com- 
peting merchants, the regulation of prices, the attempts 
to check '^ profiteering " — the detailed application of 
these measures may have been effective or ineffective, 
wise or injudicious. It is evident, indeed, that some 
of them have been foolish, like the restriction of im- 
ports when the world has -^ve years' destruction to 
repair, and that others, if sound in conception, have 
been questionable in their execution. If they were 
attacked on the ground that they obstruct the efficient 
performance of function — if the leaders of industry 
came forward and said generally, as some, to their 
honor, have : — " We accept your policy, but we will 
improve its execution; we desire payment for service 
and service only and will help the state to see that 
it pays for nothing else " — there might be controversy 
as to the facts, but there could be none as to the prin- 
ciple. 

In reality, however, the gravamen of the charges 
brought against these restrictions appears generally to 
be precisely the opposite. They are denounced by 
most of their critics not because they limit the oppor- 
tunity of service, but because they diminish the op- 
portunity for gain, not because they prevent the trader 
enriching the community; but because they make it 



26 THE ACQUISITIVE SOCIETY 

more difficult for him to enricli himself; not, in short, 
because they have failed to convert economic activity 
into a social function, but because they have come too 
near succeeding. If the financial adviser to the Coal 
Controller may be trusted, the shareholders in coal 
mines would appear to have done fairly well during 
the war. But the proposal to limit their profits to 
1/2 per ton is described by Lord Gainford as " sheer 
robbery and confiscation." With some honorable 
exceptions, what is demanded is that in the future 
as in the past the directors of industry should be free 
to handle it as an enterprise conducted for their own 
convenience or advancement, instead of being com- 
pelled, as they have been partially compelled during 
the war, to subordinate it to a social purpose. For to 
admit that the criterion of commerce and industry 
is its success in discharging a social purpose is at 
once to turn property and economic activity from 
rights which are absolute into rights which are con- 
tingent and derivative, because it is to affirm that they 
are relative to functions and that they may justly be 
revoked when the functions are not performed. It is, 
^ in short, to imply that property and economic activity 
exist to promote the ends of society, whereas hitherto 
society has been regarded in the world of business 
as existing to promote them. To those who hold their 
position, not as functionaries, but by virtue of their 
success in making industry contribute to their own 
wealth and social influence, such a reversal of means 
and ends appears little less than a revolution. For it 
means that they must justify before a social tribunal 



THE ACQUISITIVE SOCIETY 27 

rights which they have hitherto taken for granted as 
part of an order which is above criticism. 

During the greater part of the nineteenth century 
the significance of the opposition between the two prin- 
ciples of individual rights and social functions was 
masked by the doctrine of the inevitable harmony be- 
tween private interests and public good. Competition, 
it was argued, was an effective substitute for hon- 
esty. To-day that subsidiary doctrine has fallen to 
pieces under criticism; few now would profess adher- 
ence to the compound of economic optimism and moral 
bankruptcy which led a nineteenth century economist 
to say : " Greed is held in check by greed, and the 
desire for gain sets limits to itself.^' The disposi- 
tion to regard individual rights as the center and pivot 
of society is still, however^ the most powerful element 
in political thought and the practical foundation of 
industrial organization. The laborious refutation of 
the doctrine that private and public interests are co- 
incident, and that man's self-love is God's Providence, 
which was the excuse of the last century for its wor- 
ship of economic egotism, has achieved, in fact, sur- 
prisingly small results. Economic egotism is still wor- 
shiped; and it is worshiped because that doctrine 
was not really the center of the position. It was an 
outwork, not the citadel, and now that the outwork 
has been captured, the citadel is still to win. 

What gives its special quality and character, its 
toughness and cohesion, to the industrial system built 
up in the last century and a half, is not its exploded 
theory of economic harmonies. It is the doctrine that 



28 THE ACQUISITIVE SOCIETY 

economic rights are anterior to, and independent of 
economic functions, that they stand by their own vir- 
tue, and need adduce no higher credentials. The prac- 
tical result of it is that economic rights remain, \ 
whether economic functions are performed or not. They 
remain to-day in a more menacing form than in the 
age of early industrialism. For those who control in- 
dustry no longer compete but combine, and the rivalry 
between property in capital and property in land has 
long since ended. The basis of the ISTew Conservatism 
appears to be a determination so to organize society, 
both by political and economic action, as to make it 
secure against every attempt to extinguish payments 
which are made, not for service, but because the own- 
ers possess a right to extract income without it. Hence 
the fusion jof the two traditional parties, the proposed 
" strengthening " of the second chamber, the return to 
protection, the swift conversion of rival industrialists 
to the advantages of monopoly, and the attempts to buy 
off with concessions the more influential section of the 
working classes. Revolutions, as a long and bitter ex- 
perience reveals, are apt to take their color from the 
regime which they overthrow. Is it any wonder that \ 
the creed which aflSrms the absolute rights of property ' 
should sometimes be met with a counter-affirmation of 
the absolute rights of labor, less anti-social, indeed, and 
inhuman, but almomst as dogmatic, almost as intoler- 
ant and thoughtless as itself? 

A society which aimed at making the acquisition of 
wealth contingent upon the discharge of social obliga- 



THE ACQUISITIVE SOCIETY 29 

tions, which sought to proportion remuneration to serv- 
ice and denied it to those by whom no service was per- 
formed, which inquired first not what men possess but 
what they can make or create or achieve, might be 
called a Functional Society, because in such a society 
the main subject of social emphasis would be the per- 
formance of functions. But such a society does not 
exist, even as a remote ideal, in the modern world, 
though something like it has hung, an unrealized the- 
ory, before men's minds in the past. Modern societies 
aim at protecting economic rights, while leaving eco- 
nomic functions, except in moments of abnormal emer- 
gency, to fulfil themselves. The motive which gives 
color and quality to their public institutions, to their 
policy and political thought, is not the attempt to 
secure the fulfilment of tasks undertaken for the pub- 
lic service; but to increase the opportunities open to 
individuals of attaining the objects which they conceive 
to be advantageous to themselves. If asked the end or 
criterion of social organization, they would give an an- 
swer reminiscent of the formula the greatest happiness 
of the greatest number. But to say that the end of 
social institutions is happiness, is to say that they 
have no common end at all. For happiness is in- 
dividual, and to make happiness the object of society 
is tu resolve society itself into the ambitions of num- 
berless individuals, each directed towards the attain- 
ment of some personal purpose. 

Such societies may be called Acquisitive Societies, 
because their whole tendency and interest and pre- 
occupation is to promote the acquisition of wealth. The 



30 THE ACQUISITIVE SOCIETY 

appeal of this conception must be powerful, for it lias 
laid the whole modern world under its spell. Since 
England first revealed the possibilities of industrial- 
ism, it has gone from strength to strength, and as in- 
dustrial civilization invades countries hitherto remote 
from it, as Russia and Japan and India and China 
are drav^i into its orbit, each decade sees a fresh ex- 
tension of its influence. The secret of its triumph 
is obvious. It is an invitation to men to use the pow- 
ers with which they have been endowed by nature or 
society, by skill or energy or relentless egotism or mere 
good fortune, without inquiring whether there is any 
principle by which their exercise should be limited. 
It assumes the social organization which determines 
the opportunities which different classes shall in fact 
possess, and concentrates attention upon the right of 
those who possess or can acquire power to make the 
fullest use of it for their own self-advancement. By 
fixing men's minds, not upon the discharge of social 
obligations, which restricts their energy, because it de- 
fines the goal to which it should be directed, but upon 
the exercise of the right to pursue their own self- 
interest, it offers unlimited scope for the acquisition 
of riches, and therefore gives free play to one of the 
most powerful of human instincts. To the strong it 
promises unfettered freedom for the exercise of their 
strength; to the weak the hope that they too one day 
may be strong. Before the eyes of both it suspends a 
golden prize, which not all can attain, but for which 
each may strive, the enchanting vision of infinite ex- 
pansion. It assures men that there are no ends other 



THE ACQUISITIVE SOCIETY 31 

than their ends, no law other than their desires, no 
limit other than that "which thej think advisable. Thus 
it makes the individual the center of his own universe, 
and dissolves moral princij)les into a choice of ex- 
pediences. And it immensely simplifies the problems 
of social life in complex communities. For it relieves 
them of the necessity of discriminating between dif- 
ferent types of economic activity and different sources 
of wealth, between enterprise and avarice, energy and 
unscrupulous greed, property which is legitimate and 
property which is theft, the just enjoyment of the 
fruits of labor and the idle parasitism of birth or for- 
tune, because it treats all economic activities as stand- 
ing upon the same level, and suggests that excess or 
defect, waste or superfluity, require no conscious ef- 
fort of the social will to avert them, but are corrected 
almost automatically by the mechanical play of eco- 
nomic forces.^ 

Under the impulse of such ideas men do not be- 
come religious or wise or artistic; for religion and 
wisdom and art imply the acceptance of limitations. 
But they become powerful and rich. They inherit the 
earth and change the face of nature, if they do not 
possess their own souls; and they have that appear- 
ance of freedom which consists in the absence of ob- 
stacles between opportunities for self-advancement and 
those whom birth or wealth or talent or good fortune 
has placed in a position to seize them. It is not diffi- 
cult either for individuals or for societies to achieve 
their object, if that object be sufficiently limited and 
immediate, and if they are not distracted from its 



32 THE ACQUISITIVE SOCIETY 

pursuit by other considerations. Tlie temper which 
dedicates itself to the cultivation of opportunities, and 
leaves obligations to take care of themselves, is set upon 
an object which is at once simple and practicable. The 
eighteenth century defined it. The twentieth century 
has very largely attained it. Or, if it has not attained 
it, it has at least grasped the possibilities of its attain- 
ment. The national output of wealth per head of 
population is estimated to have been approximately $200 
in 1914. Unless mankind chooses to continue the sac- 
rifice of prosperity to the ambitions and terrors of 
nationalism, it is possible that by the year 2000 it may 
be doubled. 



IV 

THE NEMESIS OF INDUSTRIALISM 

Such happiness is not remote from achievement. In 
the course of achieving it, however, the world has been 
confronted by a group of unexpected consequences, 
which are the cause of its malaise, as the obstruction 
of economic opportunity was the cause of social malaise 
in the eighteenth century. And these consequences are 
not, as is often suggested, accidental mal-adjustments, 
but flow naturally from its dominant principle : so that 
there is a sense in which the cause of its perplexity 
is not its failure, but the quality of its success, and 
its light itself a kind of darkness. The will to economic 
power, if it is sufficiently single-minded, brings riches. 
But if it is single-minded it destroys the moral re- 
straints which ought to condition the pursuit of riches,, 
and therefore also makes the pursuit of riches mean- 
ingless. For what gives meaning to economic activity, 
as to any other activity is, as we have said, the pur- 
pose to which it is directed. But the faith upon which 
our economic civilization reposes, the faith that riches 
are not a means but an end, implies that all economic 
activity is equally estimable, whether it is subordinated 
to a social purpose or not. Hence it divorces gain from 
service, and justifies rewards for which no function is 
performed, or which are out of all proportion to it. 

Wealth in modern societies is distributed according to 

33 



34 THE ACQUISITIVE SOCIETY 

opportunity; and while opportunity depends partly 
upon talent and energy, it depends still more upon 
birth, social position, access to education and inherited 
wealth; in a word, upon property. Eor talent and 
energy can create opportunity. But property need only 
wait for it. It is the sleeping partner who draws the 
dividends which the firm produces, the residuary lega- 
tee who always claims his share in the estate. 

Because rewards are divorced from services, so that 
what is prized most is not riches obtained in return 
for labor but riches the economic origin of which, being 
regarded as sordid, is concealed, two results follow. 
The first is the creation of a class of pensioners upon 
industry, who levy toll upon its product, but contribute 
nothing to its increase, and who are not merely tol- 
erated, but applauded and admired and protected with 
assiduous care, as though the secret of prosperity re- 
sided in them. They are admired because in the ab- 
sence of any principle of discrimination between in-| 
comes which are payment for functions and incomes! 
which are not, all incomes, merely because they rep-' 
resent wealth, stand on the same level of appreciation, 
and are estimated solely by their magnitude, so that^ 
in all societies which have accepted industrialism there 
is an upper layer which claims the enjoyment of social 
life, while it repudiates its responsibilities. The ren- 
tier and his ways, how familiar they were in England 
before the war! A public school and then club life 
in Oxford and Cambridge, and then another club in 
town; London in June, when London is pleasant, the 
moors ill August, and pheasants in October, Cannes in 



THE NEMESIS OF INDUSTRIALISM 35 

December and hunting in February and March; and 
a whole world of rising bourgeoisie eager to imitate 
them, sedulous to make their expensive watches keep 
time with this preposterous calendar! 

The second consequence is the degradation of those 
who labor, but who do not by their labor command 
large rewards; that is of the great majority of man- 
kind. And this degradation follows inevitably from 
the refusal of men to give the purpose of industry 
the first place in their thought about it. When they 
do that, when their minds are set upon the fact that 
the meaning of industry is the service of man, all who 
labor appear to them honorable, because all who labor 
serve, and the distinction which separates those who 
serve from those who merely spend is so crucial and 
fundamental as to obliterate all minor distinctions 
based on differences of income. But when the cri- 
terion of function is forgotten, the only criterion which 
remains is that of wealth, and an Acquisitive Society 
reverences the possession of wealth, as a Functional 
Society would honor, even in the person of the hum- 
blest and most laborious craftsman, the arts of 
creation. 

So wealth becomes the foundation of public esteem, 
and the mass of men who labor, but who do not ac- 
quire wealth, are thought to be vulgar and meaning- 
less and insignificant compared with the few who ac- 
quire wealth by good fortune, or by the skilful use of 
economic opportunities. They come to be regarded, 
not as the ends for which alone it is worth while to 
produce wealth at all, but as the instruments of its 



36 THE ACQUISITIVE SOCIETY 

acquisition by a world that declines to be soiled by con- 
tact with what is thought to be the dull and sordid 
business of labor. They are not happy, for the reward 
of all but the very mean is not merely money, but the 
esteem of their fellow-men, and they know they are not 
esteemed, as soldiers, for example, are esteemed, though 
it is because they give their lives to making civiliza- 
tion that there is a civilization which it is worth while 
for soldiers to defend. They are not esteemed, be- 
cause the admiration of society is directed towards 
those who get, not towards those who give; and though 
workmen give much they get little. And the rentiers 
whom they support are not happy; for in discarding 
the idea of function, which sets a limit to the acquisi- 
tion of riches, they have also discarded the principle 
which alone give riches their meaning. Hence unless 
they can persuade themselves that to be rich is in it- 
self meritorious, they may bask in social admiration, 
but they are unable to esteem themselves. For they 
have abolished the principle which makes activity sig- 
nificant, and therefore estimable. They are, indeed, 
more truly pitiable than some of those who envy them. 
For like the spirits in the Inferno, they are punished 
by the attainment of their desires. 

A society ruled by these notions is necessarily the 
victim of an irrational inequality. To escape such in- 
equality it is necessary to recognize that there is some 
principle which ought to limit the gains of particular 
classes and particular individuals, because gains drawn 
from certain sources or exceeding certain amounts are 
illegitimate. But such a limitation implies a stand- 



THE NEMESIS OF INDUSTEIALISM 37 

ard of discrimination, which is inconsistent with the 
assumption that each man has a right to what he can 
get, irrespective of any service rendered for it. Thus 
privilege, which was to have been exorcised by the gos- 
pel of 1789, returns in a new guise, the creature no 
longer of unequal legal rights thwarting the natural 
exercise of equal powers of hand and brain, but of 
unequal powers springing from the exercise of equal 
rights in a world where property and inherited wealth 
and the apparatus of class institutions have made op- 
portunities unequal. Inequality, again, leads to the 
mis-direction of production. For, since the demand of 
one income of £50,000 is as powerful a magnet as the 
demand of 500 incomes of £100, it diverts energy from 
the creation of wealth to the multiplication of luxuries, 
so that, for example, while one-tenth of the people of 
England are overcrowded^ a considerable part of them 
are engaged, not in supplying that deficiency, but in 
making rich men's hotels, luxurious yachts, and motor- 
cars like that used by the Secretary of State for War, 
" with an interior inlaid with silver in quartered ma- 
hogany, and upholstered in fawn suede and morocco," 
which was recently bought by a suburban capitalist, by 
way of encouraging useful industries and rebuking pub- 
lic extravagance with an example of private economy, 
for the trifling sum of $14,000. 

Thus part of the goods which are annually produced, 
and which arc called wealth, is, strictly speaking, waste, 
because it consists of articles which, though reckoned 
as part of the income of the nation, either should not 
have been produced until other articles had already 



38 THE ACQUISITIVE SOCIETY 

been produced in sufficient abundance, or should not 
have been produced at all. And some part of the popu- 
lation is employed in making goods which no man can 
make with happiness, or indeed without loss of self- 
respect, because he knows that they had much better 
not be made; and that his life is wasted in making them. 
Everybody recognizes that the army contractor who, 
in time of war, set several hundred navvies to dig an 
artificial lake in his grounds, was not adding to, but 
subtracting from, the wealth of the nation. But in 
time of peace many hundred thousand workmen, if they 
are not digging ponds, are doing work which is equally 
foolish and wasteful ; though, in peace, as in war, there 
is important work, which is waiting to be done, and 
which is neglected. It is neglected because, while tbe 
effective demand of the mass of men is only too small, 
there is a small class which wears several men's clothes, 
eats several men's dinners, occupies several families' 
houses, and lives several men's lives. As long as a 
minority has so large an income that part of it, if spent 
at all, must be spent on trivialties, so long will part 
of the human energy and mechanical equipment of the 
nation be diverted from serious work, which enriches 
it, to making trivialities, which impoverishes it, since 
they can only be made at the cost of not making other 
things. And if the peers and millionaires who are now 
preaching the duty of production to miners and dock 
laborers desire that more wealth, not more waste, should 
be produced; the simplest way in which they can achieve 
their aim is to transfer to the public their whole in- 
comes over (say) $5,000 a year, in order that it may 



THE NEMESIS OF INDUSTRIALISM 39 

be spent in setting to work, not gardeners, chauffeurs, 
domestic servants and shopkeepers in the West End of 
London, but builders^ mechanics and teachers. 

So to those who clamor, as many now do, ^' Produce ! 
Produce ! '' one simple question may be addressed : — 
" Produce what ? " Food, clothing, house-room, art, 
knowledge? By all means! But if the nation is 
scantily furnished with these things had it not better 
stop producing a good many others which fill shop 
windows in Regent Street? If it desires to re-equip 
its industries with machinery and its railways with 
wagons, had it not better refrain from holding ex- 
hibitions designed to encourage rich men to re-equip 
themselves with motor-cars ? What can be more child- 
ish than to urge the necessity that productive power 
should be increased, if part of the productive power 
which exists already is misapplied? Is not less pro- 
duction of futilities as important as, indeed a condi- 
tion of, more production of things of moment ? Would 
not " Spend less on private luxuries " be as wise a 
cry as " produce more " ? Yet this result of inequal- 
ity, again, is a phenomenon which cannot be prevented, 
or checked, or even recog-nized by a society which ex- 
cludes the idea of purpose from its social arrange- 
ments and industrial activity. For to recognize it is 
to admit that there is a principle superior to the 
mechanical play of economic forces, which ought to 
determine the relative importance of different occu- 
pations, and thus to abandon the view that all riches, 
however composed, are an end, and that aU economic 
activity is equally justifiable. 



40 THE ACQUISITIVE SOCIETY 

The rejection of the idea of purpose involves an- 
other consequence which every one laments, hut which 
no one can prevent, except hy ahandoning the belief 
that the free exercise of rights is the main interest oi 
society and the discharge of obligations a secondary 
and incidental consequence which may be left to take 
care of itself. It is that social life is turned into a 
scene of fierce antagonisms and that a considerable part 
of industry is carried on in the intervals of a disguised 
social war. The idea that industrial peace can be 
secured merely by the exercise of tact and forbear- 
ance is based on the idea that there is a fundamental 
identity of interest between the different groups en- 
gaged in it, which is occasionally interrupted by re- 
grettable misunderstandings. Both the one idea and 
the other are an illusion. The disputes which matter 
are not caused by a misunderstanding of identity of 
interests, but by a better understanding of diversity 
of interests. Though a formal declaration of war is 
an episode, the conditions which issue in a declaration 
of war are permanent; and what makes them per- 
manent is the conception of industry which also makes 
inequality and functionless incomes permanent. It is 
the denial that industry has any end or purpose other 
than the satisfaction of those engaged in it. 

That motive j)roduces industrial warfare, not as a 
regrettable incident, but as an inevitable result. It 
produces industrial war, because its teaching is that 
each individual or group has a right to what they can 
get, and denies that there is any principle, other than 
the mechanism of the market, which determines what 



THE NEMESIS OF INDUSTRIALISM 41 

they ought to get. For, since the income available for 
distribution is limited, and since, therefore, when cer- 
tain limits have been passed, what one group gains 
another group must lose, it is evident that if the rela- 
tive incomes of different groups are not to be deter- 
mined by their functions, there is no method other 
than mutual self-assertion which is left to determine 
them. Self-interest, indeed, may cause them to re- 
frain from using their full strength to enforce their 
claims, and, in so far as this happens, peace is se- 
cured in industry, as men have attempted to secure 
it in international affairs, by a balance of power. But 
the maintenance of such a peace is contingent upon 
the estimate of the parties to it that they have more 
to lose than to gain by an overt struggle, and is not 
the result of their acceptance of any standard of re- 
muneration as an equitable settlement of their claims. 
Hence it is precarious, insincere and short. It is with- 
out finality, because there can be no finality in the 
mere addition of increments of income, any more than 
in the gratification of any other desire for material 
goods. When demands are conceded the old strug- 
gle recommences upon a new level, and will always 
recommence as long as men seek to end it merely by 
increasing remuneration, not by finding a principle upon 
which all remuneration, whether large or small, should 
be based. 

Such a principle is offered by the idea of function, 
because its application would eliminate the surpluses 
which are the subject of contention, and would make . 
it evident that remuneration is based upon service, 



42 THE ACQUISITIVE SOCIETY 

not upon chance or privilege or the power to use op- j 
portunities to drive a hard bargain. But the idea of 
function is incompatible v^ith the doctrine that every 
person and organization have an unlimited right to ex- 
ploit their economic opportunities as fully as they j 
please, which is the working faith of modern industry ; ^ 
and, since it is not accepted, men resign themselves 
to the settlement of the issue by force, or propose that 
the State should supersede the force of private associa- 
tions by the use of its force, as though the absence 
of a principle could be compensated by a new kind 
of machinery. Yet all the time the true cause of in- 
dustrial warfare is as simple as the true cause of inter- 
national warfare. It is that if men recognize no law 
superior to their desires, then they must fight when 
their desires collide. For though groups or nations 
which are at issue with each other may be willing to 
submit to a principle which is superior to them both, 
there is no reason why they should submit to each 
other. 

Hence the idea, which is popular with rich men, 
that industrial disputes would disappear if only the 
output of wealth were doubled, and every one were 
twice as well off, not only is refuted by all practical 
experience, but is in its very nature founded upon an 
illusion. For the question is one not of amounts but 
of proportions; and men will fight to be paid $120 a 
week, instead of $80, as readily as they will fight to 
be paid $20 instead of $16, as long as there is no reason 
why they should be paid $80 instead of $120, and as 
long as other men who do not work are paid anything 



THE NEMESIS OF INDUSTRIALISM 43 

at all. If miners demanded higher wages when every 
superfluous charge upon coal-getting had been elimi- 
nated, there would be a principle with which to meet 
their claim, the principle that one group of workers 
ought not to encroach upon the livelihood of others. 
But as long as mineral owners extract royalties, and 
exceptionally productive mines pay thirty per cent, to 
absentee shareholders, there is no valid answer to a de- 
mand for higher wages. Eor if the community pays 
anything at all to those who do not work, it can afford 
to pay more to those who do. The naive complaint, that 
workmen are never satisfied, is, therefore, strictly true. 
It is true, not only of workmen, but of all classes in 
a society which conducts its affairs on the principle \ 
that wealth, instead of being proportioned to func- 
tion, belongs to those who can get it. They are never 
satisfied, nor can they be satisfied. For as long as 
they make that principle the guide of their individual , 
lives and of their social order, nothing short of in- j 
finity could bring them satisfaction. 

So here, again, the prevalent insistence upon rights, 
and prevalent neglect of functions, brings men into 
a vicious circle which they cannot escape, without es- 
caping from the false philosophy which dominates them. 
But it does something more. It makes that philosophy 
itself seem plausible and exhilarating, and a rule not 
only for industry, in which it had its birth, but for 
politics and culture and religion and the whole com- 
pass of social life. The possibility that one aspect of 
human life may be so exaggerated as to overshadow, 



44 THE ACQUISITIVE SOCIETY 

and in time to atrophy, every other, has been made 
familiar to Englishmen by the example of '' Prussian 
militarism/' Militarism is the characteristic, not of 
an army, but of a society. Its essence is not any par- 
ticular quality or scale of military preparation, but 
a state of mind, which, in its concentration on one par- 
ticular element in social life, ends finally by exalting 
it until it becomes the arbiter of all the rest. The 
purpose for which military forces exist is forgotten. 
They are thought to stand by their own right and 
to need no justification. Instead of being regarded 
as an instrument which is necessary in an imperfect 
world, they are elevated into an object of superstitious 
veneration, as though the world would be a poor in- 
sipid place without them, so that political institutions 
and social arrangements and intellect and morality and 
religion are crushed into a mold made to fit one activity, 
which in a sane society is a subordinate activity, like 
the police, or the maintenance of prisons, or the cleans- 
ing of sewers, but which in a militarist state is a kind 
of mystical epitome of society itself. 

Militarism, as Englishmen see plainly enough, is 
fetich worship. It is the procuration of men's souls 
before, and the laceration of their bodies to appease, 
an idol. What they do not see is that their reverence 
for economic activity and industry and what is called 
business is also fetich worship, and that in their devo- 
tion to that idol they torture themselves as needlessly 
and indulge in the same meaningless antics as the Prus- 
sians did in their worship of militarism. Eor what 
the military tradition and spirit have done for Prus- 



THE NEMESIS OF INDUSTRIALISM 45 

sia, with the result of creating militarism, the com- 
mercial tradition and spirit have done for England, 
with the result of creating industrialism. Industrial- 
ism is no more a necessary characteristic of an econom- 
ically developed society than militarism is a necessary 
characteristic of a nation which maintains military 
forces. It is no more the result of applying science to 
industry than militarism is the result of the applica- 
tion of science to war, and the idea that it is some- 
thing inevitable in a community which uses coal and 
iron and machinery, so far from being the truth, is 
itself a product of the perversion of mind which in- 
dustrialism produces. Men may use what mechanical 
instruments they please and be none the worse for their 
use. What kills their souls is when they allow their 
instruments to use them. The essence of industrial- 
ism, in short, is not any particular method of indus- 
try, but a particular estimate of the importance of 
industry, which results in it being thought the only 
thing that is important at all, so that it is elevated 
from the subordinate place which it should occupy 
among human interests and activities into being the 
standard by which all other interests and activities are 
judged. 

When a Cabinet Minister declares that the great- 
ness of this country depends upon the volume of its 
exports, so that France, with exports comparatively lit- 
tle, and Elizabethan England, which exported next to 
nothing, are presumably to be pitied as altogether in- 
ferior civilizations, that is Industrialism. It is the 
confusion of one minor department of life with the 



46 THE ACQUISITIVE SOCIETY 

whole of life. When manufacturers cry and cut them- 
selves with knives, because it is proposed that boys and 
girls of fourteen shall attend school for eight hours a 
week, and the President of the Board of Education is 
so gravely impressed by their apprehensions, that he 
at once allows the hours to be reduced to seven, that 
is Industrialism. It is fetich worship. When the Gov- 
ernment obtains money for a war, which costs $28,- 
000,000 a day, by closing the Museums, which cost 
$80,000 a year, that is Industrialism. It is a con- 
tempt for all interests which do not contribute ob- 
viously to economic activity. When the Press clamors 
that the one thing needed to make this island an Ar- 
cadia is productivity, and more productivity, and yet . 
more productivity, that is Industrialism. It is the 
confusion of means with ends. 

Men will always confuse means with ends if they 
are without any clear conception that it is the ends, 
not the means, which matter — if they allow their minds 
to slip from the fact that it is the social purpose of 
industry which gives it meaning and makes it worth 
while to carry it on at all. And when they do that, 
they will turn their whole world upside down, because 
they do not see the poles upon which it ought to move. 
So when, like England, they are thoroughly industrial- 
ized, they behave like Germany, which was thoroughly 
i militarized. They talk as though man existed for in- 
■[dustry, instead of industry existing for man, as the 
Prussians talked of man existing for war. They re- 
sent any activity which is not colored by the predom- 
inant interest, because it seems a rival to it. So they 



THE NEMESIS OF INDUSTRIALISM 47 

destroy religion and art and morality, which cannot 
exist unless they are disinterested; and having de- 
stroyed these, which are the end, for the sake of in- 
dustry, which is a means, they make their industry 
itself what they make their cities, a desert of unnat- 
ural dreariness, which only forgetfulness can make en- 
durable, and which only excitement can enable them 
to forget. 

Torn by suspicions and recriminations, avid of 
power, and oblivious of duties, desiring peace, but un- 
able to " seek peace and ensue it,'' because unwilling 
to surrender the creed which is the cause of war, to 
what can one compare such a society but to the inter- 
national world, which also has been called a society 
and which also is social in nothing but name? And 
the comparison is more than a play upon words. It 
is an analogy which has its roots in the facts of his- 
tory. It is not a chance that the last two centuries, 
which saw the new growth of a new system of indus- 
try, saw also the growth of the system of international 
politics which came to a climax in the period from 
1870 to 1914. Both the one and the other are the 
expression of the same spirit and move in obedience 
to similar laws. The essence of the former was the \ 
repudiation of any authority superior to the individual I 
reason. It left men free to follow their own inter- 
ests or ambitions or appetites, untrammeled by subor- 
dination to any common center of allegiance. The es- 
sence of the latter was the repudiation of any au- 
thority superior to the sovereign state, which again was 
conceived as a compact self-contained unit — a unit 



48 THE ACQUISITIVE SOCIETY 

whicli would lose its very essence if it lost its inde- 
pendence of other states. Just as the one emancipated 
economic activity from a mesh of antiquated tradi- 
tions, so the other emancipated nations from arbitrary 
subordination to alien races or Governments, and turned 
them into nationalities with a right to work out their 
ovTn destiny. 

IsTationalism is, in fact, the counterpart among na-> 
tions of what individualism is within them. It has 
similar origins and tendencies, similar triumphs and 
defects. For nationalism, like individualism, lays its 
emphasis on the rights of separate units, not on their 
subordination to common obligations, though its units 
are races or nations, not individual men. Like individ- 
ualism it appeals to the self-assertive instincts, to which 
it promises opportunities of unlimited expansion. Like 
individualism it is a force of immense explosive power, 
the just claims of which must be conceded before it 
is possible to invoke any alternative principle to con- 
trol its operations. For one cannot impose a super- 
national authority upon irritated or discontented or 
oppressed nationalities any more than one can subor- 
dinate economic motives to the control of society, until 
society has recognized that there is a sphere which 
they may legitimately occupy. And, like individual- 
ism, if pushed to its logical conclusion, it is self-destruc- 
tive. For as nationalism^ in its brilliant youth, be- 
gins as a claim that nations, because they are spiritual 
beings, shall determine themselves, and passes too often 
into a claim that they shall dominate others, so in- 
dividualism begins by asserting the right of men to 



THE NEMESIS OF INDUSTRIALISM 49 

make of their own lives what they can, and ends by 
condoning the subjection of the majority of men to 
the few whom good fortune or special opportunity or 
privilege have enabled most successfully to use their 
rights. They rose together. It is probable that, if 
ever they decline, they wiU decline together. For 
life cannot be cut in corapartments. In the long run 
the world reaps in war what it sows in peace. And 
to expect that international rivalry can be exercised as 
long as the industrial order within each nation is such 
as to give success to those whose existence is a strug- 
gle for self-aggrandizement is a dream which has not 
even the merit of being beautiful. 

So the perversion of nationalism is imperialism, as 
the perversion of individualism is industrialism. And 
the perversion comes, not through any flaw or vice in 
human nature, but by the force of the idea, because 
the principle is defective and reveals its defects as 
it reveals its power. For it asserts that the rights of 
nations and individuals are absolute, which is false, 
instead of asserting that they are absolute in their 
own sphere, l^ut that their sphere itself is contingent 
upon the part which they play in the community of 
nations and individuals, which is true. Thus it con- 
strains them to a career of indefinite expansion, in 
which they devour continents and oceans, law, mo- 
rality and religion, and last of all their own souls, in 
an attempt to attain infinity by the addition to them- 
selves of all that is finite. In the meantime their rivals, 
and their subjects, and they themselves are conscious 
of the danger of opposing forces, and seek to pur- 



50 THE ACQUISITIVE SOCIETY 

/chase security and to avoid a collision by organizing a 
balance of power. But the balance, whether in inter- 
national politics or in industry, is unstable, because 
it reposes not on the common recognition of a prin- 
ciple by which the claims of nations and individuals 
are limited, but on an attempt to find an equipoise 
which may avoid a conflict without adjuring the as- 
sertion of unlimited claims. No such equipoise can be 
found, because, in a world where the possibilities of 
increasing military or industrial power are illimitable, 
no such equipoise can exist. 

Thus, as long as men move on this plane, there is 
no solution. They can obtain peace only by surren- 
dering the claim to the unlettered exercise of their 
rights, which is the cause of war. What we have been 
witnessing, in short, during the past five years, both 
in international affairs and in industry, is the break- 
down of the organization of society on the basis of 
rights divorced from obligations. Sooner or later the 
collapse was inevitable, because the basis was too nar- 
row. Eor a right is simply a power which is secured < 
by legal sanctions, " a capacity,'' as the lawyers de- » 
fine it, " residing in one man, of controlling, with the 
assistance of the State, the action of others," and a 
right should not be absolute for the same reason that 
a power should not be absolute. No doubt it is better 
that individuals should have absolute rights than that 
the State or the Government should have them; and 
it was the reaction against the abuses of absolute power 
by the State which led in the eighteenth century to 
the declaration of the absolute rights of individuals. 



THE NEMESIS OF INDUSTRIALISM 51 

The most obvious defense against the assertion of one 
extreme was the assertion of the other. Because Gov- 
ernments and the relics of feudalism had encroached 
upon the property of individuals it was affirmed that 
the right of property was absolute; because they had 
strangled enterprise, it was affirmed that every man ; 
had a natural right to conduct his business as he pleased. 
But, in reality, both the one assertion and the other 
are false, and, if applied to practice, must lead to. 
disaster. The State has no absolute rights; they are 
limited by its commission. The individual has no 
absolute rights ; they are relative to the function which 
he performs in the community of which he is a mem- 
ber, because, unless they are so limited, the conse- 
quences must be something in the nature of private 
war. All rights, in short, are conditional and deriva- 
tive, because all power should be conditional and de- 
rivative. They are derived from the end or purpose 
of the society in which they exist. They are condi- 
tional on being used to contribute to the attainment 
of that end, not to thwart it. And this means in 
practice that, if society is to b e healthy , men must 
regard themselves not as the owners of rights, but as 
trustees for the discharge of functions and the instru- ^ 
ments of a social purpose. 



V 

PROPERTY AND CREATIVE WORK 

The application of the principle that society should 
be organized upon the basis of functions, is not recon- 
dite, but simple and direct. It offers in the first place, 
a standard for discriminating between those types of 
private property which are legitimate and those which 
are not. During the last century and a half, political 
thought has oscillated between two conceptions of prop- 
erty, both of which, in their different ways, are ex-, 
travagant. On the one hand, the practical founda- 
tion of social organization has been the doctrine that 
the particular forms of private property which exist 
at any moment are a thing sacred and inviolable, that 
anything may properly become the object of prop- 
erty rights, and that, when it does, the title to it is 
absolute and unconditioned. The modern industrial 
system took shape in an age when this theory of prop- 
erty was triumphant. The American Constitution and 
the French Declaration of the Eights of Man both 
treated property as one of the fundamental rights 
which Governments exist to protect. The English Kev- 
olution of 1688, undogmatic and reticent though it 
was, had in effect done the same. The great individ- 
ualists from Locke to Turgot, Adam Smith and Ben- 
tham all repeated, in different language, a similar con- 
ception. Though what gave the Revolution its dia- 

52 



PEOPERTY AND CREATIVE WORK 53 

bolical character in the eyes of the English upper 
classes was its treatment of property, th-e dogma of 
the sanctity of private property was maintained as tena- 
ciously by French Jacobins as by English Tories; and 
the theory that property is an absolute, which is held 
by many modern Conservatives, is identical, if only 
they knew it, with that not only of the men of 1789, 
but of the Convention itself. 

On the other hand, the attack has been almost as 
undiscriminating as the defense. ^' Private property " 
has been the central position against which the social 
movement of the last hundred years has directed its 
forces. The criticism of it has ranged from an im- 
aginative communism in the most elementary and per- 
sonal of necessaries, to prosaic and partially realized 
proposals to transfer certain kinds of property from 
private to public ownership, or to limit their exploita- 
tion by restrictions . imposed by the State. But, how- 
ever varying in emphasis and in method, the general 
note of what may conveniently be called the Socialist 
criticism of property is what the word Socialism itself 
implies. Its essence is the statement that the economic 
evils of society are primarily due to the unregulated 
operation, under modern conditions of industrial organ- 
ization, of the institution of private property. 

The divergence of opinion is natural, since in most 
discussions of property the opposing theorists have usu- 
ally been discussing different things. Property is the 
most ambiguous of categories. It covers a multitude 
of rights which have nothing in common except that 
they are exercised by persons and enforced by the State. 



54 THE ACQUISITIVE SOCIETY 

Apart from these formal characteristics, they vary in- 
definitely in economic character, in social effect, and 
in moral justification. They may be conditional like 
the grant of patent rights, or absolute like the own- 
ership of ground rents, terminable like copyright, or 
permanent like a freehold, as comprehensive as sov- 
ereignty or as restricted as an easement, as intimate 
and personal as the ov^nership of clothes and books, or 
as remote and intangible as shares in a gold mine or 
rubber plantation. It is idle, therefore, to present a 
case for or against private property without specify- 
ing the particular forms of property to which refer-/ 
ence is made, and the journalist who says that "pri-i 
vate property is the foundation of civilization " agrees 
with Proudhon, who said it was theft, in this respect 
at least that, without further definition, the words of 
both are meaningless. Arguments which support or 
demolish certain kinds of property may have no appli- 
cation to others; considerations which are conclusive 
in one stage of economic organization may be almost 
irrelevant in the next. The course of wisdom is neither j 
to attack private property in general nor to defend 
it in general; for things are not similar in quality, 
merely because they are identical in name. It is to 
discriminate between the various concrete embodiments 
of what, in itself, is, after all, little more than an ab- 
straction. 

The origin and development of different kinds of 
proprietary rights is not material to this discussion. 
Whatever may have been the historical process by 
which they have been established and recognized, the 



PROPERTY AND CREATIVE WORK 55 

rationale of private property traditional in England is 
that which sees in it the security that each man will 
reap where he has sown. ^' If I despair of enjoying 
the fruits of labor," said Bentham, repeating what were 
in all essentials the arguments of Locke, ^' I shall only 
live from day to day; I shall not undertake labors 
which will only benefit my enemies." Property, it is 
argued, is a moral right, and not merely a legal right, 
because it insures that the producer will not be de- 
prived by violence of the result of his efforts. The 
period from which that doctrine was inherited differed 
from our own in three obvious, but significant, respects. 
Property in land and in the simple capital used in 
most industries was widely distributed. Before the rise 
of capitalist agriculture and capitalist industry, the 
ownership, or at any rate the secure and effective occu- 
pation, of land and tools by those who used them, was 
a condition precedent to effective work in the field 
or in the workshop. The forces which threatened prop- 
erty were the fiscal policy of Governments and in some 
countries, for example France, the decaying relics of 
feudalism. The interference both of the one and of 
the other involved the sacrifice of those who carried 
on useful labor to those who did not. To resist them 
was to protect not only property but industry, which 
was indissolubly connected with it. Too often, indeed, 
resistance was ineffective. Accustomed to the misery 
of the rural proprietor in Prance, Voltaire remarked 
with astonishment that in England the peasant may 
be rich, and " does not fear to increase the number 
of his beasts or to cover his roof with tiles." And 



56 THE ACQUISITIVE SOCIETY 

the English Parliamentarians and the French phi- 
losophers who made the inviolability of property rights 
the center of their political theory, when they defended 
those who owned, were incidentally^ if sometimes unin- 
tentionally, defending those who labored. They were 
protecting the yeoman or the master craftsman or the 
merchant from seeing the fruits of his toil squandered 
by the hangers-on at St. James or the courtly parasites 
of Versailles. 

In such circumstances the doctrine which found the 
justification of private property in the fact that it 
enabled the industrious man to reap where he had 
sown, was not a paradox, but, as far as the mass of 
the population was concerned, almost a truism. Prop- 
erty was defended as the most sacred of rights. But 
it was defended as a right which was not only widely 
exercised, but which was indispensable to the per- 
formance of the active function of providing food and 
clothing. Eor it consisted predominantly of one of 
two types, land or tools which were used by the owner 
for the purpose of production, and personal posses- 
sions which were the necessities or amenities of civil- 
ized existence. The former had its rationale in the 
fact that the land of the peasant or the tools of the 
craftsman were the condition of his rendering the eco- 
nomic services which society required; the latter be- 
cause furniture and clothes are indispensable to a life 
of decency and comfort. The proprietary ri ghts — and, 
of course, they were numerous — which had their source, 
not in work, but in _.pr edator y foipe, were protected 
from criticism by the wide distribution of some kind 



PROPEETY AND CREATIVE WORK 57 

of property among the mass of the population, and 
in England, at least, the cruder of them were grad- 
ually whittled down. When property in land and what 
simple capital existed were generally diffused among 
all classes of society, when, in raost parts of England, 
the typical workman was not a laborer but a peasant 
or small master, who could point to the strips which 
he had plowed or the cloth which he had woven, 
when the greater part of the wealth passing at death 
consisted of land, household furniture and a stock in 
trade which was hardly distinguishable from it, the 
moral justification of the title to property was self- 
evident. It was obviously, what theorists said, that it 
was, and plain men knew it to be, the labor spent in 
producing, acquiring and administering it. 

Such property was not a burden upon society, but 
a condition of its health and efficiency, and indeed, of 
its continued existence. To protect it was to main- 
tain the organization through which public necessi- 
ties were supplied. If, as in Tudor England, the peas- 
ant was evicted from his holding to make room for 
sheep, or crushed, as in eighteenth century France, by 
arbitrary taxation and seignurial dues, land went out 
of cultivation and the whole community was short of 
food. If the tools of the carpenter or smith were 
seized, plows were not repaired or horses shod. 
Hence, before the rise of a commercial civilization, it 
was the mark of statesmanship, alike in the England 
of the Tudors and in the France of Henry IV, to 
cherish the small property-owner even to the point of 
offending the great. Popular sentiment idealized the 



58 THE ACQUISITIVE SOCIETY 

yeoman — " the Joseph of the country who keeps the 
poor from starving '' — not merely because he owned 
property, but because he worked on it, denounced that 
'^ bringing of the livings of many into the hands of one," 
which capitalist societies regard with equanimity as 
an inevitable, and, apparently, a laudable result of eco- ■ 
nomic development, cursed the usurer who took advan- i 
tage of his neighbor's necessities to live without labor, 
was shocked by the callous indifference to public wel- 
fare shown by those who " not having before their 
eyes either God or the profit and advantage of the 
realm, have enclosed with hedges and dykes towns and 
hamlets," and was sufficiently powerful to compel Gov- 
ernments to intervene to prevent the laying of field to 
field, and the engrossing of looms — to set limits, in 
short, to the scale to which property might grow. 

When Bacon, who commended Henry VII for pro- 
tecting the tenant right of the small farmer, and pleaded , 
in the House of Commons for more drastic land legis- j 
lation, wrote '' Wealth is like muck. It is not good \ 
but if it be spread," he was expressing in an epigram 
what was the commonplace of every writer on politics 
from Fortescue at the end of the fifteenth century to 
Harrington in the middle of the seventeenth. The 
modern conservative, who is inclined to take au pied de 
la lettre the vigorous argument in which Lord Hugh 
Cecil denounces the doctrine that the maintenance of 
proprietary rights ought to be contingent upon the use 
to which they are put, may be reminded that Lord 
Hugh's own theory is of a kind to make his ancestors 
turn in their graves. Of the two members of the 



PROPERTY AND CREATIVE WORK 59 

family who achieved distinction before the nineteenth 
century, the elder advised the Crown to prevent land- 
lords evicting tenants, and actually proposed to fix a 
pecuniary maximum to the property which different 
classes might possess, while the younger attacked en- 
closing in Parliament, and carried legislation compel- 
ling landlords to build cottages, to let them with small 
holdings, and to plow up pasture. 

William and Robert Cecil were sagacious and re- 
sponsible men, and their view that the protection of 
property should be accompanied by the enforcement of 
obligations upon its owners was shared by most of their 
contemporaries. The idea that the institution of pri- 
vate property involves the right of the owner to use it, 
or refrain from using it, in such a way as he may please, 
and that its principal significance is to supply him with 
an income, irrespective of any duties which he may dis- 
charge, would not have been understood by most public 
men of that age, and, if understood, would have been 
repudiated with indignation by the more reputable 
among them. They found the meaning of property 
in the public purposes to which it contributed, whether 
they were the production of food, as among the peas- 
antry, or the management of public affairs, as among 
the gentry, and hesitated neither to maintain those kinds 
of property which met these obligations nor to repress 
those uses of it which appeared likely to conflict with 
them. Property was to be an aid to creative work, not 
an alternative to it. The patentee was secured pro- 
tection for a new invention, in order to secure him the 
fruits of his own brain, but the monopolist who grew 



I 



ed THE ACQriSnTTE SOCIETT 

&T cai the industrv of oiLers ^£s to be pm down. The 
lav of tbe TiHsige bcmnd ibe pe£5;£i:i to ii>e Id? land, nol 
as }>e himself mishi ^cd mosi prrdi^rlr, "bni lo grow the 
com the viH^gt rieeded. Lcoig afrer priiiieal changes 
kftd mjide direet inreTiepene^ impraeiic-alur, eren the 
ki^»sr rtfiks of Engji^li Ijindoviiss contiiiiied to dis- 
ckaige. l»veTer cftpikioii^ and trraimieally, dniies 
^v^k^ were vstgiiebr fdt to be the eontrihntioii which 
Tht J made to Ae pdblie serviee in Tirtoe of their esiates. 
"When as in Fianoe, the obiigaticaQs of ownership were 
i^podiated almoet as compkt^ as they hame hesi l^ 
the owner of to-dav, nsn^is came in an cmslaii^t upon 
the pcsmon of a wiMesst vhidi had retained its r:rr:s 
and ahdieated its fimeti^ms. PropeHy repceed, in i ' 
not BicKiy iq«cm ccHrroiience, or the appetite f oi _ 
bat «i a BKaal principle- It ^as proieeted not onlv 
for tie sake of those who owtaed. tut for il 

tkose -mho woAsd aud of those for wLcm -. 

pvorided. It was prcteeted, because. ~:-h "- fr::ir:rr 
ftsr pwiperrr, Treahh could not be 7 zhe 

cf socieST carried cm. 



Vh ai e t^T tbe fatnre nunr coptain, the past has sbnvn 
1 -XD^leDt soeial order than Aat in which the 

i^ It people wea^ tbe masters of the holdings 

-^ _ ^-r^T-^ and of Ae tods with whidi tber 

- : - i boK^ with the EngKsh frediQlder, 

•khhTi • i: ?? to a man's mind to lire upaa 

r- - — -hi? heir certain." With this eoo- 

~ 5Li>6 7"!? ?T*rtir?I ^"s^aies^oKk in social 
1^ - - sbcnld be 



\ 



PEOPEETT ASl) CEEATIYE WORK 61 

ized on the basis of function Lave no q^iarreL It is in 
agreement with their own dcotrine. =inoe it jnstines 
property bj re feren ce to the ^^rrices which it enables 
its owner to perfomL All that thev neeii ask is that \ 
it should be carried to its logical conclusion- 

For the argnment has evidently more than one edge. 
If it justifies certain types of property, it condemns 
others ; and in the conditions of modem indtLstrial ciTi- 
Uzation^ what it justifies is less than what it ct:ndemns. 
The truth is, indeed, that this theory of property and 
the institutions in which it is embodied have survived 
into an age in which the whole structure ' ' 'j is 
radically different from that in which it : rmtt- 

lated, and which made it a valid aiOTment, if not for 
all, at least for the most common and characteristic 
kinds of property. It is not merely that the ownership 
of any substantial share in the national wealth is con- 
centrated to-day in the hands of a few hun<ired thou- 
sand families, and that at the end of an age which 
began with an aSrmation of the rights of pro-perty, pro- 
prietary rights are, in fact, far from being widely dis- 
tributed. Xor L5 it merely that what makes property 
insecure to-day is not the arbitrary taxation of uneon- 
stitutional monarchies or the privileges of an i<ile 
nohlesse, but the insatiable expansic^n and aggregatio-n 
of property itself, which menac-es with absorption all 
property less than the greatest, the small master, the 
little shopkeeper, the cijuntry bank, and has turned 
the mass of mankind into a pr«:>letariat wc^rking under 
the agents and for the profit of thjse who own. 

The characteristic fact, which differentiates most 



J 



G2 THE ACQUISITIVE SOCIETY 

modern property from that of the pre-industrial age, 
and which turns against it the very reasoning by which 
formerly it was supported, is that in modern economic 
conditions ownership is not active, but passive, that to 
most of those who own property to-day it is not a means 
of work but an instrument for the acquisition of gain 
or the exercise of power, and that there is no guarantee 
that gain bears any relation to service, or power to 
responsibility. For property which can be regarded as 
1 a condition of the performance of function, like the tools 
I of the craftsman, or the holding of the peasant, or the 
I personal possessions which contribute to a life of health 
* and efficiency, forms an insignificant proportion, as far 
as its value is concerned, of the property rights exist- 
ing at present. In modern industrial societies the great 
mass of property consists, as the annual review of wealth 
passing at death reveals, neither of personal acquisitions 
such as household furniture, nor of the owner's stock- 
in-trade, but of rights of various kinds, such as royal- 
ties, ground-rents, and, above all, of course shares in 
industrial undertakings which yield an income irre- 
spective of any personal service rendered by their 
owners. Ownership and use are normally divorced. 
The greater part of modern property has been atten- 
uated to a pecuniary lien or bond on the product of 
industry which carries with it a right to payment, but 
which is normally valued precisely because it relieves 
the owner from any obligation to perform a positive or 
constructive function. 

Such property may be called passive property, or 
property for acquisition, for exploitation, or for power, 



PROPEETY AND CEEATIVE WORK 63 

to distinguish it from the property which is actively 
used by its owner for the conduct of his profession or 
the upkeep of his household. To the lawyer the first 
is, of course,' as fully property as the second. It is 
questionable, however, whether economists shall call it 
I " Property " at all, and not rather, as Mr. Hobson has 
Suggested, " Improperty,'' since it is not identical with 
the rights which secure the owner the produce of his 
toil, but is opposite of them. A classification of pro- 
prietary rights based upon this difference would be in- 
structive. If they were arranged according to the close- 
ness with which they approximate to one or other of 
these two extremes, it would be found that they were 
spread along a line stretching from property which is 
obviously the payment for, and condition of, personal 
services, to property which is merely a right to pay- 
ment from the services rendered by others, in fact a 
private tax. The rough order which would emerge, if 
all details and qualification were omitted, might be 
something as follows: — 

1. Property in payments made for personal services. 

2. Property in personal possessions necessary to 
health and comfort. 

3. Property in land and tools used by their owners. 

4. Property in copyright and patent rights owned by 
authors and inventors. 

5. Property in pure interest, including much agri- 
cultural rent. 

6. Property in profits of luck and good fortune; 
*' quasi-rents." 

7. Property in monopoly profits. 



64 THE ACQUISITIVE SOCIETY 

8. Property in urban ground rents. . 

9. Property in royalties. • 
The first four kinds of property obviously accompany, 

and in some sense condition, the performance of work. 
The last four obviously do not. Pure interest has some 
affinities with both. It represents a necessary economic 
cost, the equivalent of which must be born, whatever the 
legal arrangements under which property is held, and 
is thus unlike the property representd by profits (other 
than the equivalent of salaries and payment for neces- 
sary risk), urban ground-rents and royalties. It re- 
lieves the recipient from personal services, and thus 
resembles them. I 

The crucial question for any society is, under which 
each of these two broad groups of categories the greater 
part (measured in value) of the proprietary rights; 
which it maintains are at any given moment to be found. ; 
If they fall in the first group creative work will bej' 
encouraged and idleness will be depressed; if they fall 
in the second, the result will be the reverse. The facts 
vary widely from age to age and from country to coun- 
try. E'or have they ever been fully revealed; for the 
lords of the jungle do not hunt by daylight. It is 
probable, at least, that in the England of 1550 to 1750, 
a larger proportion of the existing property consisted of 
land and tools used by their owners than either in con- 
temporary France, where feudal dues absorbed a con- 
siderable proportion of the peasants' income, or than in 
the England of 1800 to 1850, where the new capitalist 
manufacturers made hundreds per cent, while manual 
workers were goaded by starvation into ineffectu^ re- 



PROPERTY AND CREATIVE WORK 65 

volt. It is probable that in the nineteenth century, 
thanks to the Kevolution, France and England changed 
places, and that in this respect not only Ireland but the 
British Dominions resemble the former rather than the 
latter. The transformation can be studied best of all in 
the United States, in parts of which the population of 
peasant proprietors and small masters of the early nine- 
teenth century were replaced in three generations by a 
propertyless proletariat and a capitalist plutocracy. 
The abolition of the economic privileges of agrarian 
feudalism, which, under the name of equality, was the 
driving force of the Trench Revolution, and which has 
taken place, in one form or another, in all countries 
touched by its influence, has been largely counter- 
balanced since 1800 by the growth of the inequalities 
springing from Industrialism. 

In England the general effect of recent economic 
development has been to swell proprietary rights which 
entitle the owners to payment without work, and to 
diminish those which can properly be described as 
functional. The expansion of the former, and the 
process by which the simpler forms of property have 
been merged in them, are movements the significance of 
which it is hardly possible to over-estimate. There is, 
of course, a considerable body of property which is still 
of the older type. But though working landlords, and 
capitalists who manage their own businesses, are still 
in the aggregate a numerous body, the organization for 
which they stand is not that which is most representa- 
tive of the modern economic world. The general tend- 
ency for the ownership and administration of prop- 



G6 THE ACQUISITIVE SOCIETY 

erty to be separated, the general refinement of property 
into a claim on goods produced by an unknown worker, 
is as unmistakable as the growth of capitalist industry 
and urban civilization themselves. Villages are turned 
into towns and property in land changes from the hold- 
ing worked by a farmer or the estate administered by a 
landlord into ^' rents," which are advertised and bought 
and sold like any other investment. Mines are opened 
and the rights of the landowner are converted into a 
tribute for every ton of coal which is brought to the 
surface. As joint-stock companies take the place of the 
individual enterprise which was typical of the earlier 
years of the factory system, organization passes from the 
employer who both owns and manages his business, into 
the hands of salaried officials, and again the mass of 
property-owners is swollen by the multiplication of 
rentiers who put their wealth at the disposal of indus- 
try, but who have no other connection with it. The 
change is taking place in our day most conspicuously, 
perhaps, through the displacement in retail trade of the 
small shopkeeper by the multiple store, and the substi- 
tution in manufacturing industry of combines and amal- 
gamations for separate businesses conducted by compet- 
ing employers. And, of course, it is not only by eco- 
nomic development that such claims are created. " Out 
of the eater came forth meat, and out of the strong 
came forth sweetness." It is probable that war, which in 
barbarous ages used to be blamed as destructive of 
property, has recently created more titles to property 
than almost all other causes put together. 

Infinitely diverse as are these proprietary rights, they 



PROPERTY AND CREATIVE WORK G7 

have the common characteristic of being so entirely sepa- 
rated from the actual objects over which thej are exer- 
cised, so rarified and generalized, as to be analogous 
almost to a form of currency rather than to the property 
which is so closely united to its owner as to seem a 
part of him. Their isolation from the rough environ- 
ment of economic life, where the material objects of 
which they are the symbol are shaped and handled, is 
their charm. It is also their danger. The hold which a 
class has upon the future depends on the function which 
it performs. What nature demands is work : few work- 
ing aristocracies, however tyrannical, have fallen; few 
functionless aristocracies have survived. In society, as 
in the world of organic life, atrophy is but one stage 
removed from death. In proportion as the landowner 
becomes a mere rentier and industry is conducted, not 
by the rude energy of the competing employers who 
dominated its infancy, but by the salaried servants of 
shareholders, the argument for private property which 
reposes on the impossibility of finding any organization 
to supersede them loses its application, for they are 
already superseded. 

Whatever may be the justification of these types of 
property, it cannot be that which was given for the 
property of the peasant or the craftsman. It cannot be 
that they are necessary in order to secure to each man 
the fruits of his own labor. For if a legal right which 
gives $200,000 a year to a mineral owner in the ISTorth 
of England and to a gi'ound landlord in London '^ se- 
cures the fruits of labor " at all, the fruits are the pro- 
prietor's and the labor that of some one else. Property 



68 THE ACQUISITIVE SOCIETY 

has no more insidious enemies than those well-meaning 
anarchists who, by defending all forms of it as equally 
valid, involve the institution in the discredit attaching 
to its extravagances. In reality, whatever conclusion 
may be drawn from the fact, the greater part of modern 
property, whether, like mineral rights and urban 
ground-rents, it is merely a form of private taxation 
which the law allows certain persons to levy on the 
industry of others, or whether, like property in capital, 
it consists of rights to payment for instruments which 
the capitalist cannot himself use but puts at the disposal 
of those who can, has as its essential feature that it 
confers upon its owners income unaccompanied by per- 
sonal service. In this respect the ownership of land 
and the ownership of capital are normally similar, 
though from other points of view their differences are 
important. To the economist rent and interest are dis- 
tinguished by the fact that the latter, though it is often 
accompanied by surplus elements which are merged with 
it in dividends, is the price of an instrument of pro- 
duction which would not be forthcoming for industry if 
the price were not paid, while the former is a differ- 
ential surplus which does not affect the supply. To the 
business community and the solicitor land and capital 
are equally investments, between which, since they pos- 
sess the common characteristic of yielding income with- 
out labor, it is inequitable to dii3criminate ; and though 
their significance as economic categories may be dif- 
ferent, their effect as social institutions is the same. It 
is to separate property from creative ability, and to 
.divide society into two classes^ of which one hag its 



PROPEETY AND CREATIVE WORK 69 

primary interest in passive ownership, while the other 
is mainly dependent upon active work. 

Hence the real analogy to many kinds of modern 
property is not the simple property of the small land- 
owner or the craftsman, still less the household goods 
and dear domestic amenities, which is what the word 
suggests to the guileless minds of clerks and shopkeepers, 
and which stampede them into displaying the ferocity 
of terrified sheep when the cry is raised that ^' Prop- 
erty " is threatened. It is the feudal dues which robbed 
the French peasant of part of his produce till the Kevo- 
lution abolished them. How do royalties differ from 
quintaines and lods et ventesf They are similar in their 
• origin and similar in being a tax levied on each incre- 
ment of wealth which labor produces. How do urban 
ground-rents differ from the payments which were made 
to English sinecurists before the Eeform Bill of 1832 ? 
They are equally tribute paid by those who work to those 
V who do not. If the monopoly profits of the owner of 
hanalites, whose tenant must grind corn at his mill and 
make wine at his press, were an intolerable oppression, 
what is the sanctity attaching to the monopoly profits 
of the capitalists, who, as the Keport of the Government 
Committee on trusts tells us, " in soap, tobacco, wall- 
paper, salt, cement and in the textile trades . . . are 
in a position to control output and prices " or, in other 
words, can compel the consumer to buy from them, at 
the figure they fix, on pain of not buying at all ? 

All these rights — royalties, ground-rents, monopoly 
profits — are " Property." The criticism most fatal to 
them is not that of Socialists. It is contained in the 



70 THE ACQUISITIVE SOCIETY 

arguments by whicli property is usually defended. Eor 
if the meaning of the institution is to encourage indus- 
ry by securing that the worker shall receive the produce 
of his toil, then precisely in proportion as it is important 
to preserve the property which a man has in the results 
of his own efforts, is it important to abolish that which 
he has in the results of the efforts of some one else. The 
considerations which justify ownership as a function are 
those which condemn it as a tax. Property is not theft, 
but a good deal of theft becomes property. The owner 
of royalties who, when asked why he should be paid 
£50,000 a year from minerals which he has neither 
discovered nor developed nor worked but only owned, 
replies ^^ But it's Property ! " may feel all the awe 
which his language suggests. But in reality he is be- 
having like the snake which sinks into its background 
by pretending that it is the dead branch of a tree, or 
the lunatic who tried to catch rabbits by sitting behind 
a hedge and making a noise like a turnip. He is prac- 
tising protective — and sometimes aggressive — mimicry. 
His sentiments about property are those of the simple 
toiler who fears that what he has sown another may 
reap. His claim is to be allowed to continue to reap 
what another has sown. 

It is sometimes suggested that the less attractive char- 
acteristics of our industrial civilization, its combination 
of luxury and squalor, its class divisions and class 
warfare, are accidental maladjustments which are not 
rooted in the center of its being, but are excrescences 
which economic progress itself may in time be expected 
to correct. That agreeable optimism will not survive an 



PROPERTY AND CREATIVE WORK 71 

examination of the operation of the institution of pri- 
vate property in land and capital in industrialized com- 
munities. In countries where land is widely distributed, 
in France or in Ireland, its effect may be to produce 
a general diffusion of wealth among a rural middle 
class who at once work and own. In countries where 
the development of industrial organization has sepa- 
rated the ownership of property and the performance of 
work, the normal effect of private property is to trans- 
fer to functionless owners the surplus arising from the 
more fertile sites, the better machinery, the more elabo- 
rate organization. 'No clearer exemplifications of this 
" law of rent " has been given than the figures supplied 
to the Coal Industry Commission by Sir Arthur Lowes 
Dickenson, which showed that in a given quarter the 
costs per ton of producing coal varied from $3.12 to 
$12 per ton, and the profits from nil to $4.12. The dis- 
tribution in dividends to shareholders of the surplus 
accruing from the working of richer and more acces- 
sible seams, from special opportunities and access to 
markets, from superior machinery, management and or- 
ganization, involves the establishment of Privilege as a 
national institution, as much as the most arbitrary exac- 
tions of a feudal seigneur. It is the foundation of an 
inequality which is not accidental or temporary, but 
necessary and permanent. And on this inequality is 
erected the whole apparatus of class institutions, which 
make not only the income, but the housing, education, 
health and manners, indeed the very physical appear- 
ance of different classes of Englishmen almost as dif- 
ferent from each other as though the minority were 



72 THE ACQUISITIVE SOCIETY 

alien settlers established amid the rude civilization of a 
race of impoverished aborigines. 

So the justification of private property traditional in 
England, which saw in it the security that each man 
would enjoy the fruits of his own labor, though largely 
applicable to the age in which it was formulated, has 
undergone the fate of most political theories. It has 
/ been refuted not by the doctrines of rival philosophers, 
but by the prosaic course of economic development As 
far as the mass of mankind are concerned, the need 
which private property other than personal possessions 
does still often satisfy, though imperfectly and precari- 
ously, is the need for security. To the small investors, 
who are the majority of property-owners, though owning 
only an insigTiificant fraction of the property in exist- 
ence, its meaning is simple. It is not wealth or power, 
or even leisure from work. It is safety. They work 
hard. They save a little money for old age, or for sick- 
ness, or for their children. They invest it, and the 
interest stands between them and all that they dread 
most. Their savings are of convenience to industry, the 
income from them is convenient to themselves. 
" Why,'' they ask, " should we not reap in old age the 
advantage of energy and thrift in youth ? " And this 
hunger for security is so imperious that those who suffer 
most from the abuses of property, as well as those who, 
if they could profit by them, would be least inclined to 
do so, will tolerate and even defend them, for fear lest 
the knife which trims dead matter should out into the 
quick. They have seen too many men drown to be criti- 



PROPERTY AND CREATIVE WORK 73 

cal of dry land, though it be an inhospitable rock. They 
are haunted by the nightmare of the future, and, if a 
burglar broke it, would welcome a burglar. 

This need for security is fundamental, and almost the 
gravest indictment of our civilization is that the mass 
of mankind are without it. Property is one way of 
organizing it. It is quite comprehensible therefore, 
that the instrument should be confused with the end, 
and that any proposal to modify it should create dismay. 
In the past, human beings, roads, bridges and ferries, 
civil, judicial and clerical offices, and commissions in 
the army have all been private property. Whenever it 
was proposed to abolish the rights exercised over them, 
it was protested that their removal would involve the 
destruction of an institution in which thrifty men had 
invested their savings, and on which they depended for 
protection amid the chances of life and for comfort in 
old age. In fact, however, property is not the only 
method of assuring the future, nor, when it is the way 
selected, is security dependent upon the maintenance of 
all the rights which are at present normally involved in 
ownership. In so far as its psychological foundation is 
the necessity for securing an income which is stable and 
certain, which is forthcoming when its recipient cannot 
work, and which can be used to provide for those who 
cannot provide for themselves, what is really demanded 
is not the command over the fluctuating proceeds of some 
particular undertaking, which accompanies the owner- 
ship of capital, but the security which is offered by an 
annuity. Property is the instrument, security is the 
object, and when some alternative way is forthcoming 



74 THE ACQUISITIVE SOCIETY 

of providing the latter, it does not appear in practice 
that any loss of confidence, or freedom or independence 
is caused by the absence of the former. 

Hence not only the manual workers, who since the 
rise of capitalism, have rarely in England been able 
to accumulate property sufficient to act as a guarantee 
of income when their period of active earning is past, 
but also the middle and professional classes, increas- 
ingly seek security to-day, not in investment, but in 
insurance against sickness and death, in the purchase 
of annuities, or in what is in effect the same thing, the 
accumulation of part of their salary towards a pension 
which is paid when their salary ceases. The profes- 
sional man may buy shares in the hope of making a 
profit on the transaction. But when what he desires to 
buy is security, the form which his investment takes is 
usually one kind or another of insurance. The teacher, 
or nurse, or government servant looks forward to a pen- 
sion. Women, who fifty years ago would have been re- 
garded as dependent almost as completely as if femi- 
ninity were an incurable disease with which they had 
been born, and whose fathers, unless rich men, would 
have been tormented with anxiety for fear lest they 
should not save sufficient to provide for them, now re- 
ceive an education, support themselves in professions, 
and save in the same way. It is still only in compara- 
tively few cases that this type of provision is made; 
almost all wage-earners outside government employ- 
ment, and many in it, as well as large numbers of 
professional men, have nothing to fall back upon in 
sickness or old age. But that does not alter the fact 



PROPERTY AND CREATIVE WORK 75 

that, when it is made, it meets the need for security, 
which, apart, of course, from personal possessions and 
household furniture, is the principal meaning of prop- 
erty to by far the largest element in the population, 
and that it meets it more completely and certainly than 
property itself. 

ISTor, indeed, even when property is the instrument 
used to provide for the future, is such provision de- 
pendent upon the maintenance in its entirety of the 
whole body of rights which accompany ownership to-day. 
Property is not simple but complex. That of a man 
who has invested his savings as an ordinary shareholder 
comprises at least three rights, the right to interest, the 
right to profits, the right to control. In so far as what 
is desired is the guarantee for the maintenance of a 
stable income, not the acquisition of additional wealth 
without labor — in so far as his motive is not gain but 
security — the need is met by interest on capital. It has 
no necessary connection either with the right to resid- 
uary profits or the right to control the management of 
the undertaking from which the profits are derived, both 
of which are vested to-day in the shareholder. If all 
that were desired were to use property as an instrument 
for purchasing security, the obvious course — from the 
point of view of the investor desiring to insure his 
future the safest course — would be to assimilate his 
position as far as possible to that of a debenture holder 
or mortgagee, who obtains the stable income which is his 
motive for investment, but who neither incurs the risks 
nor receives the profits of the speculator. To insist that 
the elaborate apparatus of proprietary rights which dis- 



76 THE ACQUISITIVE SOCIETY 

tributes dividends of thirty per cent to the shareholders 
in Coats, and several thousands a year to the ov^mer of 
mineral royalties and ground-rents, and then allows 
them to transmit the bulk of gains which they have not 
earned to descendants who in their turn will thus be 
relieved from the necessity of earning, must be main- 
tained for the sake of the widow and the orphan, the 
vast majority of whom have neither and would gladly 
part with them all for a safe annuity if they had, is, 
to say the least of it, extravagantly mal-d-propos. It is 
like pitching a man into the water because he expresses 
a wish for a bath, or presenting a tiger cub to a house- 
holder who is plagued with mice, on the ground that 
tigers and cats both? belong to the genus felis. The tiger 
hunts for itself not for its masters, and when game is 
scarce will hunt them. The classes who own little or no 
property may reverence it because it is security. But 
the classes who own much prize it for quite different 
reasons, and laugh in their sleeve at the innocence which 
supposes that anything as vulgar as the saving of the 
petite bourgeoisie have, except at elections, any interest 
for them. They prize it because it is the order which 
quarters them on the community and which provides for 
the maintenance of a leisure class at the public expense. 
" Possession," said the Egoist, '^ without obligation to 
the object possessed, approaches felicity." Functionless 
property appears natural to those who believe that so- 
ciety should be organized for the acquisition of private 
wealth, and attacks upon it perverse or malicious, be- 
cause the question which they ask of any institution is, 
" What does it yield ? " And such property yields much 



PROPERTY AND CREATIVE WORK 77 

to those who own it. Those, however, who hold that 
social unity and effective work are possible only if 
society is organized and wealth distributed on the basis 
of function, will ask of an institution, not, " What 
dividends does it pay ? '' but " What service does it per- 
form ? " To them the fact that much property yields 
income irrespective of any service which is performed 
or obligation which is recognized by its owners will 
appear not a quality but a vice. They will see in the 
social confusion which it produces, payments dispropor- 
tionate to service here, and payments without any serv- 
ice at all there, and dissatisfaction everywhere, a con- 
vincing confirmation of their argument that to build on 
a foundation of rights and of rights alone is to build on 
a quicksand. 

From the portentous exaggeration into an absolute of 
what once was, and still might be, a sane and social in- 
stitution most other social evils follow the power of 
those who do not work over those who do, the alternate 
subservience and rebelliousness of those who work to- 
wards those who do not, the starving of science and 
thought and creative effort for fear that expenditure 
upon them should impinge on the comfort of the slug- 
gard and the faineant, and the arrangement of society 
in most of its subsidiary activities to suit the conven- 
ience not of those who work usefully but of those who 
spend gaily, so that the most hideous, desolate and par- 
simonious places in the country are those in which the 
greatest wealth is produced, the Clyde valley, or the 
cotton towns of Lancashire, or the mining villages of 
Scotland and Wales, and the gayest and most luxurious 



78 THE ACQUISITIVE SOCIETY 

those in whicli it is consumed. From the point of view 
of social health and economic efficiency, society should 
obtain its material equipment at the cheapest price pos- 
sible, and after providing for depreciation and expan- 
sion should distribute the whole product to its working 
members and their dependents. What happens at pres- 
ent, however, is that its workers are hired at the cheap- 
est price which the market (as modified by organization) 
allows, and that the surplus, somewhat diminished by 
taxation, is distributed to the owners of property. 
Profits may vary in a given year from a loss to 100 per 
cent. But wages are fixed at a level which will enable 
the marginal firm to continue producing one year with 
another; and the surplus, even when due partly to\ 
efficient management, goes neither to managers nor 
manual workers, but to shareholders. The meaning of ' 
the process becomes startlingly apparent when, as in 
Lancashire to-day, large blocks of capital change hands 
at a period of abnormal activity. The existing share- 
holders receive the equivalent of the capitalized expecta- 
tion of future profits. The workers, as workers, do not 
participate in the immense increment in value; and 
when, in the future, they demand an advance in wages, 
they will be met by the answer that profits, which before 
the transaction would have been reckoned large, yield 
shareholders after it only a low rate of interest on their 
investment. 

The truth is that whereas in earlier ages the pro- 
tection of property was normally the protection of work, 
the relationship between them has come in the course of 
the economic development of the last two centuries to 



PEOPEETY AND CEEATIVE WOEK 79 

be very nearly reversed. The two elements which com- 
pose civilization are active effort and passive property, 
the labor of human things are the tools which human 
beings use. Of these two elements those who supply 
the first maintain and improve it, those who own the 
second normally dictate its character, its development 
and its administration. Hence, though politically free, 
the mass of mankind live in effect under rules imposed 
to protect the interests of the small section among them 
whose primary concern is ownership. From this sub- 
ordination of creative activity to passive property, the 
worker who depends upon his brains, the organizer, in- 
ventor, teacher or doctor suffers almost as much embar- 
rassment as the craftsman. The real economic cleavage 
is not, as is often said, between employers and employed, 
but between all who do constructive work, from scientist 
to laborer, on the one hand, and all whose main interest 
is the preservation of existing proprietary rights upon 
the other, irrespective of whether they contribute to con- 
structive work or not. 

If, therefore, under the modern conditions which have 
concentrated any substantial share of property in the 
hands of a small minority of the population, the world 
is to be governed for the advantages of those who own, 
it is only incidentally and by accident that the results 
will be agreeable to those who work. In practice there 
is a constant collision between them. Turned into an- 
other channel, half the wealth distributed in dividends 
to functionless shareholders, could secure every child a 
good education up to 18, could re-endow English Uni- 
versities, and (since more efficient production is im- 



80 THE ACQUISITIVE SOCIETY 

portant) could equip English industries for more ef- 
ficient production. Half tlie ingenuity now applied to 
the protection of property could have made most indus- 
trial diseases as rare as smallpox, and most English 
cities into places of health and even of beauty. What 
stands in the way is the doctrine that the rights of prop- * 
erty are absolute, irrespective of any social function \ 
which its owners may perform. So the laws which are 
most stringently enforced are still the laws which pro- 
tect property, though the protection of property is no 
longer likely to be equivalent to th e protection of w ork, 
aiid~lhemterests which govern industry and predomi- 
nate in public affairs are proprietary interests. A mill- 
owner may poison or mangle a generation of operatives ; 
but his brother magistrates will let him off with a cau- 
tion or a nominal fine to poison and mangle the next. 
For he is an owner of property. A landowner may 
draw rents from slums in which young children die at 
the rate of 200 per 1000 ; but he will be none tlie less 
welcome in polite society. Eor property has no obliga- 
tions and therefore can do no wrong. Urban land may . 
be held from the market on the outskirts of cities in 
which human beings are living three to a room, and 
rural land "may be used for sport when villagers are 
leaving it to overcrowd them still more. 'No public 
authority intervenes, for both are property. To those 
who believe that institutions which repudiate all moral 
significance must sooner or later collapse, a society 
which confuses the protection of property with the pres- 
ervation of its functionless perversions will appear as 
precarious as that which has left the memorials of its 



PEOPERTY AND CREATIVE WORK 81 

tasteless frivolity and more tasteless ostentation in the 
gardens of Versailles. 

Do men love peace ? They will see the greatest enemy 
of social unity in rights which involve no obligation 
to co-operate for the service of society. Do they value 
equality ? Property rights which dispense their owners 
from the common human necessity of labor make in- 
equality an institution permeating every corner of 
society, from the distribution of material wealth to the 
training of intellect itself. Do they desire greater in- 
dustrial efficiency? There is no more fatal obstacle to 
efficiency than the revelation that idleness has the same 
privileges as industry, and that for every additional 
blow with the pick or hammer an additional profit 
will be distributed among shareholders who wield ' 
neither. 

In deed, f unctionles SijQroperty is the g:reatest enemy of \ 
legitimate property itself. It is the parasite which kills \ 
the organism that produced it. Bad money drives out ] 
good, and, as the history of the last two hundred years / 
shows, when property for acquisition or power and prop- / 
erty for service or for use jostle each other freely in 
the market, without restrictions such as some legal sys- 
tems have imposed on alienation and inheritance, the 
latter tends normally to be absorbed by the former, be- 
cause it has less resisting power. Thus functionless 
property grows, and as it grows it undermines the crea- 
tive energy which produced property and which in 
earlier ages it protected. It cannot unite men, for 
what unites them is the bond of service to a common 
purpose, and that bond it repudiates, since its very / 






82 THE ACQUISITIVE SOCIETY 

essence is the maintenance of rights irrespective of 
service. It cannot create; it can only spend, so that 
the number of scientists, inventors, artists or men of 
letters who have sprung in the course of the last cen- 
tury from hereditary riches can be numbered on one 
hand. It values neither culture nor beauty, but only 
the power which belongs to wealth and the ostentation 
which is the symbol of it. 

So those who dread these qualities, energy and 
thought and the creative spirit — and they are many — 
will not discriminate, as we have tried to discriminate,, 
between different types and kinds of property, in order f 
that they may preserve those which are legitimate and 
abolish those which are not. They will endeavor to pre-' 
serve all private property, even in its most degenerate 
forms. And those who value those things will try to 
promote them by relieving property of its perversions, 
and thus enabling it to return to its true nature. They 
will not desire to establish any visionary communism, 
for they will realize that the free disposal of a sufficiency 
of personal possessions is the condition of a healthy and 
self-respecting life, and will seek to distribute more 
widely the property rights which make them to-day the 
privilege of a minority. But they will refuse to submit 
to the naive philosophy which would treat all proprie- 
tary rights as equal in sanctity merely because they are 
identical in name. They will distinguish sharply be- 
tween property which is used by its owner for the con- 
duct of his profession or the upkeep of his household, 
and property which, is merely a claim on wealth pro- 
duced by another's labor. They will insist that prop- 



PROPERTY AND CREATIVE WORK 83 

erty is moral and healthy only when it is used as a con- 
dition not of idleness but of activity, and when it in- 
volves the discharge of definite personal obligations. 
They will endeavor, in short, to base it upon the prin- 
ciple of function. 



VI 

THE FUNCTIONAL SOCIETY 

The application to property and industry of the prin- 
ciple of function is compatible with several different 
types of social organization, and is as unlikely as more 
important revelations to be the secret of those who cry 
^' Lo here ! '' and '^ Lo there ! " The essential thing is 
that men should ^x their minds upon the idea of pur- 
pose, and give that idea pre-eminence over all subsidiary 
issues. If, as is patent, the purpose of industry is to 
provide the material foundation of a good social life, 
then any measure which makes that provision more ef- 
fective, so long as it does not conflict with some still 
more important purpose, is wise, and any institution 
^ which thwarts or encumbers it is foolish. It is foolish, 
for example, to cripple education, as it is crippled in 
England for the sake of industry ; for one of the uses of 
industry is to provide the wealth which may make pos- 
sible better education. It is foolish to maintain prop- 
erty rights for which no service is performed, for pay- 
ment without service is waste; and if it is true, as 
statisticians affirm, that, even were income equally di- 
vided, income per head would be small, then it is all 
the more foolish, for sailors in a boat have no room for 
first-class passengers, and it is all the more important 
that none of the small national income should be mis- 
applied. It is foolish to leave the direction of industry 

84 



THE FUNCTIONAL SOCIETY 85 

in the hands of servants of private property-owners who 
themselves know nothing about it but its balance sheets, 
because this is to divert it from the performance of 
service to the acquisition of gain, and to subordinate 
those who do creative work to those who do not. 

The course of wisdom in the affairs of industry is, 
after all, what it is in any other department of organ- 
ized life. It is to consider the end for which economic 
activity is carried on and then to adapt economic or- 
ganization to it. It is to pay for service and for 
service only, and when capital is hired to make sure 
that it is hired at the cheapest possible price. It is to 
place the responsibility for organizing industry on the 
shoulders of those who work and use, not of those who 
own, because production is the business of the pro- 
ducer and the proper person to see that he discharges 
his business is the consumer for whom, and not for the 
owner of property, it ought to be carried on. Above all 
it is to insist that all industries shall be conducted in 
complete publicity as to costs and profits, because pub- 
licity ought to be the antiseptic both of economic and 
political abuses, and no man can have confidence in his 
neighbor unless both work in the light. 

As far as property is concerned, such a policy would 
possess two edges. On the one hand, it would aim at 
abolishing those forms of property in which ownership 
is divorced from obligations. On the other hand, it 
would seek to encourage those forms of economic organi- 
zation under which the worker, whether owner or not, is 
free to carry on his work without sharing its control or 
its profits with the mere rentier. Thus, if in certain 



86 THE ACQUISITIVE SOCIETY 

spheres it involved an extension of public ownership, it 
would in others foster an extension of private prop- 
erty. For it is not private ownership, but private owner- 
ship divorced from work, which is corrupting to thei 
principle of industry 5 and the idea of some socialists' 
that private property in land or capital is necessarily 
mischievous is a piece of scholastic pedantry as absurd 
as that of those conservatives who would invest all prop- 
erty with some kind of mysterious sanctity. It all de- 
pends what sort of property it is and for what purpose 
it is used. Provided that the State retains its emi- 
nent domain, and controls alienation, as it does under 
the Homestead laws of the Dominions, with sufficient 
stringency to prevent the creation of a class of func- 
tionless property-owners, there is no inconsistency be- 
tween encouraging simultaneously a multiplication of 
peasant farmers and small masters who own their own 
farms or shops, and the abolition of private ownership 
in those industries, unfortunately to-day the most con- 
spicuous, in which the private owner is an absentee 
shareholder. 

Indeed, the second reform would help the first. In so 
far as the community tolerates functionless property it 
makes difficult, if not impossible, the restoration of the 
small master in agriculture or in industry, who cannot 
easily hold his own in a world dominated by great 
estates or capitalist finance. In so far as it abolishes 
those kinds of property which are merely parasitic, it 
facilitates the restoration of the small property-owner 
in those kinds of industry for which small ownership is 
adapted. A socialistic policy towards the former is not 



THE FUNCTIONAL SOCIETY 87 

antagonistic to the '^ distributive state," but, in modern 
economic conditions, a necessary preliminary to it, and 
if by '^ Property " is meant the personal possessions 
which the word suggests to nine-tenths of the popula- 
tion, the object of socialists is not to undermine prop- 
erty but to protect and increase it. The boundary be- 
tween large scale and small scale production will always 
be uncertain and fluctuating, depending, as it does, on 
technical conditions which cannot be foreseen : a cheap- 
ening of electrical power, for example, might result in 
the decentralization of manufactures, as steam resulted 
in their concentration. The fundamental issue, how- 
ever, is not between different scales of ovmership, but 
between ownership of different kinds, not between the 
large farmer or master and the small, but between prop- 
erty which is used for work and property which yields 
income without it. The Irish landlord was abolished, 
not because he owned a large scale, but because he was 
an owner and nothing more; if, and when English land- 
ownership has been equally attenuated, as in towns it 
already has been, it will deserve to meet the same fate, 
Once the issue of the character of ownership hgs been 
settled, the question of the size of the economic unit can 
be left to settle itself. 

The first step, then, towards the organization of ecD- 
nomic life for the performance of function is to abolish 
those types of private property in return for which no 
function is performed. The man who lives by crwning 
without working is necessarily supported by the indus- 
try of some one else, and is, therefore, too expensi\se a 
luxury to be encouraged. Though he deserves to be 



SS THE ACQUISmTE SOCIETY 

tivatod \rith tlie lenieiioT Trhioh ought to be. and usually 
is not, sbo\m to those who have been brought up from 
infaucT to any other disreputable trade, indulgence to 
individuals must not condone the institution of which 
both they and their neighbors are the victims. Judgt"ii 
by this standard, certain kinds of property are obviously 
anti-social. The rights in virtue of whicb the owner of 
the surface is entitled to levy a tax, called a royalty, 
on every ton of coal which the miner brings to the 
surface, to levy another tax, called a way-leave, on every 
ton of coal transported under the surface of his land 
though its amenity and value may be quite unaffectini, 
to distort, if he pleases, the development of a whole 
district by refusing access to the minerals except upon 
bis own terms, and to cause some 3,500 to 4.000 million 
tons to be wasted in barriers between different proper- 
ties, while he in the meantime contributes to a chorus 
of lamentation over the wickedness of the miners in not 
producing more tons of coal for the public and inciden- 
tally more private taxes for himself — all this adds an 
agreeable touch of humor to the drab quality of our in- 
dustrial civilization for which mineral owners deserve 
perhaps some recognition, though not the $400,000 odd 
a year which is paid to each of the four leading players, 
or the $24,000,000 a year which is distributed among 
the crowd. 

The alchemy by which a gentleman who has never 
seen a coal mine distills the contents of that place of 
gloom into elegant chambers in London and a place in 
the country is not the monopoly of royalty owners. A 
similar feat of presdigitation is performed by the 



THE FUNCTIONAL SOCIETY 89 

owner of urban ground-rents. In rural districts some 
landlords, perhaps many landlords, are partners in the 
hazardous and difficult business of agriculture, and, 
though they may often exercise a power which is socially 
excessive, the position which they hold and the income 
which they receive are, in part at last, a return for 
the functions which they perform. The ownership of 
urban land has been refined till of that crude ore only 
the pure gold is left. It is the perfect sinecure, for the 
only function it involves is that of collecting its profits, 
and in an age when the struggle of Liberalism against 
sinecures was still sufficiently recent to stir some chords 
of memory, the last and greatest of liberal thinkers drew 
the obvious deduction. ^' The reasons which form the 
justification ... of property in land," wrote Mill in 
1848, '' are valid only in so far as the proprietor of land 
is its improver. . . . In no sound theory of private 
property was it ever contemplated that the proprietor of 
land should be merely a sinecurist quartered on it." 
Urban ground-rents and royalties are, in fact, as the 
Prime Minister in his unregenerate days suggested, a 
tax which some persons are permitted by the law to levy 
upon the industry of others. They differ from public 
taxation only in that their amount increases in propor- 
tion not to the nation's need of revenue but to its need 
of the coal and space on which they are levied, that their 
growth inures to private gain not to public benefit, and 
that if the proceeds are wasted on frivolous expenditure 
no one has any right to complain, because the arrange- 
ment by which Lord Smith spends wealth produced by 
Mr. Brown on objects which do no good to either is part 



90 THE ACQUISITIVE SOCIETY 

of the system which^ under the name of private prop- 
erty, Mr. Brown as well as Lord Smith have learned to 
regard as essential to the higher welfare of mankind. 

But if we accept the principle of function we shall 
ask what is the 'purpose of this arrangement, and for 
what end the inhabitants of, for example, London pay 
$64,000,000 a year to their ground landlords. And if 
we find that it is for no purpose and no end, but that 
these things are like the horseshoes and nails which 
the City of London presents to the Crown on account of 
land in the Parish of St. Clement Danes, then we shall 
not deal harshly with a quaint historical survival, but 
neither shall we allow it to distract us from the busi- 
ness of the present, as though there had been history 
but there were not history any longer. We shall close 
these channels through which wealth leaks away by re- 
suming the ownership of minerals and of urban land, 
as some communities in the British Dominions and on 
the Continent of Europe have resumed it already. We 
shall secure that such large accumulations as remain 
change hands at least once in every generation, by in- 
creasing our taxes on inheritance till what passes to the 
heir is little more than personal possessions, not the 
right to a tribute from industry which, though quali- 
fied by death-duties, is what the son of a rich man in- 
herits to-day. We shall treat mineral owners and land- 
owners, in short, as Plato would have treated the poets, 
whom in their ability to make something out of noth- 
ing and to bewitch mankind with words they a little 
resemble, and crown them with flowers and usher them 
politely out of the State. 



VII 

INDUSTRY AS A PROFESSION 

Rights without functions are like the shades in Homer 
"which drank blood but scattered trembling at the voice 
of a man. To extinguish royakies and urban ground- 
rents is merely to explode a superstition. It needs as 
little — and as much — resolution as to put one's hand 
through any other ghost. In all industries except the 
diminishing number in which the capitalist is himself 
the manager, property in capital is almost equally pas- 
sive. Almost, but not quite. For, though the majority 
of its owners do not themselves exercise any positive 
function, they appoint those who do. It is true, of 
course, that the question of how capital is to be owned 
is distinct from the question of how it is to be admin- 
istered, and that the former can be settled without 
prejudice to the latter. To infer, because shareholders 
own capital which is indispensable to industry, that 
therefore industry is dependent upon the maintenance 
of capital in the hands of shareholders, to write, with 
some economists, as though, if private property in capi- 
tal were further attenuated or abolished altogether, the 
constructive energy of the managers who may own capi- 
tal or may not, but rarely, in the more important indus- 
tries, own more than a small fraction of it, must neces- 
sarily be impaired, is to be guilty of a robust 

non-sequitur and to ignore the most obvious facts of 

91 



92 THE ACQUISITIVE SOCIETY 

contemporary industry. The less the mere capitalist 
talks about the necessity of the consumer of an efficient 
organization of industry, the better; for, whatever the 
future of industry may be, an efficient organization is 
likely to have no room for Mm. But though share- 
holders do not govern, they reign, at least to the extent 
of saying once a year ^^ le roy le veult/' If their rights 
are pared down or extinguished, the necessity for some 
organ to exercise them will still remain. And the ques- 
tion of the ownership of capital has this much in com- 
mon with the question of industrial organization, that 
the problem of the constitution under which industry 
is to be conducted is common to both. 

That constitution must be sought by considering how 
industry can be organized to express most perfectly the 
principle of purpose. The application to industry of 
the principle of purpose is simple, however difficult it , 
may be to give effect to it. It is to turn it into a Pro- ; 
fession. A Profession may be defined most simply as 
a trade which is organized, incompletely, no doubt, but / 
genuinely, for the performance of function. It is not ^ 
simply a collection of individuals who get a living for 
themselves by the same kind of work. Nor is it merely 
a group which is organized exclusively for the economic 
protection of its members, though that is normaEy 
among its purposes. It is a body of men who carry on 
their work in accordance with rules designed to enforce 
certain standards both for the better protection of its 
members and for the better service of the public. The 
standards which it maintains may be high or low: all 
professions have some rules which protect the interests 



INDUSTRY AS A PROFESSION 93 

of the community and others which are an imposition on 
it. Its essence is that it assumes certain responsibilities 
for the competence of its members or the quality of its 
wares, and that it deliberately prohibits certain kinds 
of conduct on the ground that, though they may be 
profitable to the individual, they are calculated to bring 
into disrepute the organization to which he belongs. 
While some of its rules are trade union regulations de- 
signed primarily to prevent the economic standards of 
the profession being lowered by unscrupulous competi- 
tion, others have as their main object to secure that no 
member of the profession shall have any but a purely 
professional interest in his work, by excluding the in- 
centive of speculative profit. 

The conception implied in the words " unprofessional 
conduct " is, therefore, the exact opposite of the theory 
and practice which assume that the service of the public 
is best secured by the unrestricted pursuit on the part 
of rival traders of their pecuniary self-interest, within 
such limits as the law allows. It is significant that at 
the time when the professional classes had deified free 
competition as the arbiter of commerce and industry, 
they did not dream of applying it to the occupations in 
which they themselves were primarily interested, but 
maintained, and indeed, elaborate, machinery through 
which a professional conscience might find expression. 
The rules themselves may sometimes appear to the lay- 
man arbitrary and ill-conceived. But their object is 
clear. It is to impose on the profession itself the obliga- 
tion of maintaining the quality of the service, and to 
prevent its common purpose being frustrated through 



94 THE ACQUISITIVE SOCIETY 

the undue influence of the motive of pecuniary gain 
upon the necessities or cupidity of the individual. 

The difference between industry as it exists to-day 
and a profession is, then, simple and unmistakable'. 
The essence of the former is that its only criterion is 
the financial return which it offers to its shareholders. 
The essence of the latter, is that, though men enter it| 
for the sake of livelihood, the measure of their success 
is the service which they perform, not the gains which, 
they amass. They may, as in the case of a successful 
doctor, grow rich; but the meaning of their profession, 
both for themselves and for the public, is not that they 
make money but that they make health, or safety, or 
knowledge, or good government or good law. They 
depend on it for their income, but they do not consider 
that any conduct which increases their income is on 
that account good. And while a boot-manufacturer who 
retires with half a million is counted to have achieved 
success, whether the boots which he made were of 
leather or brown paper, a civil servant who did the 
same would be impeached. 

So, if they are doctors, they recognize that there are 
certain kinds of conduct which cannot be practised, 
however large the fee offered for them, because they 
are unprofessional; if scholars and teachers, that it is 
wrong to make money by deliberately deceiving the 
public, as is done by makers of patent medicines, how- 
ever much the public may clamor to be deceived; if 
judges or public servants, that they must not increase 
their incomes by selling justice for money ; if soldiers, 
that the service comes first, and their private inclina- 



INDUSTRY AS A PROFESSION 95 

tions, even the reasonable preference of life to death, 
second. Every country has its traitors, every army its 
deserters, and every profession its blacklegs. To idealize 
the professional spirit would be very absurd; it has its 
sordid side, and, if it is to be fostered in industry, safe- 
guards will be needed to check its excesses. But there 
is all the difference between maintaining a standard 
which is occasionally abandoned, and affirming as the 
central truth of existence that there is no standard to 
maintain. The meaning of a profession is that it makes 
the traitors the exception, not as they are in industry, 
the rule. It makes them the exception by upholding as 
the criterion of success the end for which the profession, 
whatever it may be, is carried on, and subordinating the 
inclination, appetites and ambitions of individuals to 
the rules of an organization which has as its object to 
promote the performance of function. 

There is no sharp line between the professions and 
the industries. A hundred years ago the trade of teach- 
ing, which to-day is on the whole an honorable public 
service, was rather a vulgar speculation upon public 
credulity; if Mr. Squeers was a caricature, the Oxford 
of Gibbon and Adam Smith was a solid port-fed reality; 
no local authority could have performed one-tenth of 
the duties which are carried out by a modern municipal 
corporation every day, because there was no body of 
public servants to perform them, and such as there were 
took bribes. It is conceivable, at least, that some 
branches of medicine might have developed on the lines 
of industrial capitalism, with hospitals as factories, 



96 THE ACQUISITIVE SOCIETY 

doctors hired at competitive wages as their " hands/' 
large dividends paid to shareholders by catering for the 
rich, and the poor, who do not offer a profitable market, 
supplied with an inferior service or with no service at 
all. 

The idea that there is some mysterious difference 
between making munitions of war and firing them, be- 
tween building schools and teaching in them when built, 
between providing food and providing health, which 
makes it at once inevitable and laudable that the former 
should be carried on with a single eye to pecuniary gain, 
while the latter are conducted by professional men who 
expect to be paid for service but who neither watch for 
windfalls nor raise their fees merely because there are 
,,^^^^/%iore sick to be cured, more children to be taught, or 
rK*''^^^* more enemies to be resisted, is an illusion only less 
astonishing than that the leaders of industry should 
''/^ welcome the insult as an honor and wear their humilia- 
'^^<f' tion as a kind of halo. The work of making boots or 
building a house is in itself no more degrading than 
that of curing the sick or teaching the ignorant. It is 
as necessary and therefore as honorable. It should be 
at least equally bound by rules which have as their 
object to maintain the standards of professional serv- 
ice. It should be at least equally free from the 
vulgar subordination of moral standards to financial . 
interests. 

If industry is to be organized as a profession, two 
changes are requisite, one negative and one positive. 
The first, is that it should cease to be conducted by the ( 
agents of property-owners for the advantage of property- ' 




INDUSTEY AS A PKOFESSION 97 

owners, and should be carried on, instead, for the service 
of the public. The second, is that, subject to rigorous 
public supervision, the responsibility for the mainte- 
nance of the service should rest upon the shoulders of 
those, from organizer and scientist to laborer, by whom, 
in effect, the work is conducted. 

The first change is necessary because the conduct of 
industry for the public advantage is impossible as long 
as the ultimate authority over its management is vested 
in those whose only connection with it, and interest in 
it, is the pursuit of gain. As industry is at present 
organized, its profits and its control belong by law to 
that element in it which has least to do with its suc- 
cess. Under the joint-stock organization which has 
become normal in all the more important industries 
except agriculture, it is managed by the salaried agents 
of those by whom the property is owned. It is success- 
ful if it returns largs sums to shareholders, and un- 
successful if it does not. If an opportunity presents 
itself to increase dividends by practices which deterio- 
rate the service or degrade the workers, the officials who 
administer industry act strictly within their duty if they 
seize it, for they are the servants of their employers, 
and their obligation to their employers is to provide 
dividends not to provide service. But the owners of 
the property are, qua property-owners functionless, not 
in the sense, of course, that the tools of which they are 
proprietors are not useful, but in the sense that since 
work and ownership are increasingly separated, the ef- 
ficient use of the tools is not dependent on the main- 
tenance of the proprietary rights exercised over them. 



98 THE ACQUISITIVE SOCIETY 

Of course there are many managing directors who both j 
own capital and administer the business. But it is 
none the less the case that most shareholders in most 
large industries are normally shareholders and nothing 
more. 

Nor is their economic interest identical, as is some- 
times assumed, with that of the general public. A 
society is rich when material goods, including capital, 
x^are cheap, and human beings dear: indeed the word 
" riches " has no other meaning. The interest of those 
who own the property used in industry, though not, of 
course, of the managers who administer industry and 
who themselves are servants, and often very ill-paid 
servants at that, is that their capital should be dear 
and human beings cheap. Hence, if the industry is such 
as to yield a considerable return, or if one unit in the 
industry, owing to some special advantage, produces 
more cheaply than its neighbors, while selling at the 
same price, or if a revival of trade raises prices, or if 
supplies are controlled by one of the combines which 
are now the rule in many of the more important in- 
dustries, the resulting surplus normally passes neither to 
the managers, nor to the other employees, nor to the 
public, but to the shareholders. Such an arrangement is 
preposterous in the literal sense of being the reverse of 
that which would be established by considerations of 
equity and common sense, and gives rise (among other 
things) to what is called " the struggle between labor 
and capital." The phrase is apposite, since it is as 
absurd as the relations of which it is intended to be a 
description. To deplore '^ ill-feeling " or to advocate 



INDUSTRY AS A PEOFESSION 99 

" harmony " between '^ labor and capital " is as rational 
as to lament the bitterness between carpenters and ham- 
mers or to promote a mission for restoring amity be- 
tween mankind and its boots. The only significance of 
these cliches is that their repetition tends to muffle their 
inanity, even to the point of persuading sensible men 
that capital " employs " labor, much as our pagan an- 
cestors imagined that the other pieces of wood and iron, 
which they deified in their day, sent their crops and won 
their battles. When men have gone so far as to talk 
as though their idols have come to life, it is time that 
some one broke them. Labor consists of persons, capi- 
tal of things. The only use of things is to be appliedj 
to the service of persons. The business of persons is 
to see that they are there to use, and that no more than, 
need be is paid for using them. 

Thus the application to industry of the principle of 
function involves an alteration of proprietary rights, 
because those rights do not contribute, as they now are, 
to the end which industry exists to serve. What gives 
unity to any activity, what alone can reconcile the con-, 
flicting claims of the different groups engaged in it, is 
the purpose for which it is carried on. If men have no 
common goal it is no wonder that they should fall out 
by the way, nor are they likely to be reconciled by a 
redistribution of their provisions. If they are not con- 
tent both to be servants, one or other must be master, 
and it is idle to suppose that mastership can be held in 
a state of suspense between the two. There can be a 
division of functions between different grades of 
workers, or between worker and consumer, and each can 



100 THE ACQUISITIVE SOCIETY 

have in his own sphere the authority needed to enable 
him to fill it. But there cannot be a division of func- 
tions between the worker and the owner who is owner; 
and nothing else, for what function does such an owTier| 
perform ? The provision of capital ? Then pay him the 
sum needed to secure the use of his capital, but neither 
pay him more nor admit him to a position of authority 
over production for which merely as an owner he is not 
qualified. For this reason, while an equilibrium be- 
tween worker and manager is possible, because both are 
workers, that which it is sought to establish between 
worker and owner is not. It is like the proposal of the 
Germans to negotiate with Belgium from Brussels. 
Their proposals may be excellent : but it is not evident 
why they are where they are, or how, since they 
do not contribute to production, they come to be put- 
ting forward proposals at all. As long as they are 
in territory where they have no business to be, 
their excellence as individuals will be overlooked in 
annoyance at the system which puts them where they 
are. 

It is fortunate indeed, if nothing worse than this 
happens. For one way of solving the problem of the 
conflict of rights in industry is not to base rights on 
functions, as we propose, but to base them on force. It 
is to re-establish in some veiled and decorous form the 
institution of slavery, by making labor compulsory. In 
nearly all countries a concerted refusal to work has been 
made at one time or another a criminal offense. There 
are to-day parts of the world in which European capi- 
talists, unchecked by any public opinion or authority 



INDUSTRY AS A PROFESSION 101 

independent of themselves, are free to impose almost 
what terms they please upon workmen of ignorant and 
helpless races. In those districts of America where capi- 
talism still retains its primitive lawlessness, the same 
result appears to be produced upon immigrant workmen 
by the threat of violence. 

In such circumstances the conflict of rights which 
finds expression in industrial warfare does not arise, 
because the rights of one party have been extinguished. 
The simplicity of the remedy is so attractive that it is 
not surprising that the Governments of industrial na- 
tions should coquet from time to time with the policy 
of compulsory arbitration. After all, it is pleaded, it 
is only analogous to the action of a supernational au- 
thority which should use its common force to prevent 
the outbreak of war. In reality, compulsory arbitra- 
tion is the opposite of any policy which such an author- 
ity could pursue either with justice or with hope of 
success. For it takes for granted the stability of exist- 
ing relationships and intervenes to adjust incidental dis- 
putes upon the assumption that their equity is recog- 
nized and their permanence desired. In industry, how- 
ever, the equity of existing relationships is precisely the 
point at issue. A League of Nations which adjusted be- 
tween a subject race and its oppressors, between Slavs 
and Magyars, or the inhabitants of what was once 
Prussian Poland and the Prussian Government, on the 
assumption that the subordination of Slavs to Magyars 
and Poles to Prussians was part of an unchangeable 
order, would rightly be resisted by all those who think 
liberty more precious than peace. A State which, in the 



102 THE ACQUISITIVE SOCIETY 

name of peace, should make the concerted cessation of 
work a legal offense would be guilty of a similar be- 
trayal of freedom. It would be solving the conflict of 
rights between those who own and those who work by 
abolishing the rights of those who work. 

So here again, unless we are prepared to re-establish 
some form of forced labor, we reach an impasse. But 
it is an impasse only in so long as we regard the pro- 
prietary rights of those who own the capital used in 
industry as absolute and an end in themselves. If, in- 
stead of assuming that all property, merely because it 
is property, is equally sacred, we ask what is the pur- 
pose for which capital is used, what is its function, we 
shall realize that it is not an end but a means to an end, 
and that its function is to serve and assist (as the 
economists tell us) the labor of human beings, not the 
function of human beings to serve those who happen to 
own it. • And from this truth two consequences follow. 
The first is that since capital is a thing, which ought 
to be used to help industry as a man may use a bicycle 
to get more quickly to his work, it ought, when it is! 
employed, to be employed on the cheapest terms pos-l 
sible. The second is that those who own it should no 
more control production than a man who lets a house 
controls the meals which shall be cooked in the kitchen, 
or the man who lets a boat the speed at which the ■, 
rowers shall pull. In other words, capital should always 
be got at cost price, which means, unless the State finds 
it wise, as it very well may, to own the capital used in 
certain industries, it should be paid the lowest interest 



INDUSTRY AS A PEOFESSION 103 

for which it can be obtained, but should carry no right 
either to residuary dividends or to the control of in- 
dustry. 

There are, in theory, ^yq ways by which the control 
of industry by the agents of private property-owners can 
be terminated. They may be expropriated without com- 
pensation. They may voluntarily surrender it. They 
may be frozen out by action on the part of the working 
personnel, which itself undertakes such functions, if 
any, as they have performed, and makes them super- 
fluous by conducting production without their assist- 
ance. Their proprietary interest may be limited or at- 
tenuated to such a degree that they become mere 
rentiers,, who are guaranteed a fixed payment analogous 
to that of the debenture-holder, but who receive no 
profits and bear no responsibility for the organization of 
industry. They may be bought out. The first alterna- 
tive is exemplified by the historical confiscations of the 
past, such as, for instance, by the seizure of ecclesiastical 
property by the ruling classes of England, Scotland and 
most other Protestant states. The second has rarely, if 
ever, been tried — the nearest approach to it, perhaps, 
was the famous abdication of August 4th, 1789. The 
third is the method apparently contemplated by the 
building guilds which are now in process of formation 
in Great Britain. The fourth method of treating the 
capitalist is followed by the co-operative movement. It 
is also that proposed by the committee of employers and 
trade-unionists in the building industry over which Mr. 
Foster presided, and which proposed that employers 
should be paid a fixed salary, and a fijxed rate of inter- 



104 THE ACQUISITIVE SOCIETY 

est on their capital, but that all surplus profits should 
be pooled and administered by a central body repre- 
senting employers and workers. The fifth has repeat- 
edly been practised by municipalities, and somewhat 
less often by national governments. 

Which of these alternative methods of removing in- 
dustry from the control of the property-owner is adopted 
is a matter of expediency to be decided in each particu- 
lar case. " Nationalization/' therefore, which is some- 
times advanced as the only method of extinguishing pro- 
prietary rights, is merely one species of a considerable 
genus. It can be used, of course, to produce the desired 
result. But there are some industries, at any rate, in 
which nationalization is not necessary in order to bring 
it about, and since it is at best a cumbrous process, when 
other methods are possible, other methods should be 
used, l^ationalization is a means to an end, not an end 
in itself. Properly conceived its object is not to estab- 
lish state management of industry, but to remove the 
dead hand of private ownership, when the private owner 
has ceased to perform any positive function. It is un- 
fortunate, therefore, that the abolition of obstructive 
property rights, which is indispensable, should have 
been identified with a single formula, which may be 
applied with advantage in the special circumstances of 
some industries, but need not necessarily be applied in 
all. Ownership is not a right, but a bundle of rights, 
and it is possible to strip them off piecemeal as well as 
to strike them off simultaneously. The ownership of 
capital involves, as we have said, three main claims ; the 
right to interest as the price of capital, the right to 



INDUSTRY AS A PEOFESSION 105 

profits, and the right to control, in virtue of which 
managers and workmen are the servants of shareholders. 
These rights in their fullest degree are not the invariahle 
accompaniment of ownership, nor need they necessarily 
co-exist. The ingenuity of financiers long ago devised 
methods of grading stock in such a way that the owner- 
ship of some carries full control, while that of others 
does not, that some bear all the risk and are entitled to 
all the profits, while others are limited in respect to both. 
All are property, but not all carry proprietary rights 
of the same degree. 

As long as the private ownership of industrial capital 
remains, the object of reformers should be to attenuate 
its influence by insisting that it shall be paid not more 
than a rate of interest fixed in advance, and that it 
should carry with it no right of control. In such cir- 
cumstances the position of the ordinary shareholder 
would approximate to that of the owner of debentures ; 
the property in the industry would be converted into a 
mortgage on its profits, while the control of its admin- 
istration and all profits in excess of the minimum would 
remain to be vested elsewhere. So, of course, would 
the risks. But risks are of two kinds, those of the in- 
dividual business and those of the industry. The for- 
mer are much heavier than the latter, for though a coal 
mine is a speculative investment, coal mining is not, and 
as long as each business is managed as a separate unit, 
the payments made to shareholders must cover both. If 
the ownership of capital in each industry were unified, 
which does not mean centralized, those risks which are 
incidental to individual competition would be elimi- 



106 THE ACQUISITIVE SOCIETY 

nated, and the credit of each unit would be that of the 
whole. 

Such a change in the character of ownership would , 
have three advantages. It would abolish the government | 
of industry by property. It would end the payment of I 
profits to f unctionless shareholders by turning them into ■ 
creditors paid a fixed rate of interest. It would lay 
the only possible foundations for industrial peace by 
making it possible to convert industry into a profession 
carried on by all grades of workers for the service of 
the public, not for the gain of those who own capital. 
The organization which it would produce will be de- 
scribed, of course, as impracticable. It is interesting, 
therefore, to find it is that which experience has led 
practical men to suggest as a remedy for the disorders 
of one of the most important of national industries, that 
of building. The question before the Committee of em- 
ployers and workmen, which issued last August a Report 
upon the Building Trade, was '^ Scientific Management 
and the Reduction of Costs." ^ These are not phrases 
which suggest an economic revolution; but it is some- 
thing little short of a revolution that the signatories of 
the report propose. Eor, as soon as they came to grips 
with the problem, they found that it was impossible to 
handle it effectively without reconstituting the general 
fabric of industrial relationships which is its setting. 
Why is the service supplied by the industry ineffective ? 
Partly because the workers do not give their full ener- 
gies to the performance of their part in production. 

^ Reprinted in The Industrial Council for the Building In- 
dustry. 



INDUSTRY AS A PROFESSION 107 

Why do they not give their best energies ? Because of 
" the fear of unemployment, the disinclination of the 
operatives to make unlimited profit for private em- 
ployers, the lack of interest evinced by operatives owing 
to their non-participation in control, inefficiency both 
managerial and operative." IIov;^ are these psycho- 
logical obstacles to efficiency to be counteracted? By 
increased supervision and speeding up, by the allure- 
ments of a premium bonus system, or the other devices 
by which men who are too ingenious to have imagina- 
tion or moral insight would bully or cajole poor human 
nature into doing what — if only the systems they in- 
vent would let it! — it desires to do, simple duties 
and honest work? Not at all. By turning the build- 
ing of houses into what teaching now is, and Mr. 
Squeers thought it could never be, an honorable pro- 
fession. 

" We believe," they write, " that the great task of 
our Industrial Council is to develop an entirely new 
system of industrial control by the members of the in- 
dustry itself — the actual producers, whether by hand or 
brain, and to bring them into co-operation with the State 
as the central representative of the community whom 
they are organized to serve." Instead of unlimited 
profits, so " indispensable as an incentive to efficiency," 
the employer is to be paid a salary for his services as 
manager, and a rate of interest on his capital which 
is to be both fixed and (unless he fails to earn it through 
his own inefficiency) guaranteed ; anything in excess of 
it, any " profits " in fact, which in other industries are 
distributed as dividends to shareholders, he is to sur- 



108 THE ACQUISITIVE SOCIETY 

render to a central fund to be administered by em- 
ployers and workmen for the benefit of the industry as 
a whole. Instead of the financial standing of each 
firm being treated as an inscrutable mystery to the 
public, with the result that it is sometimes a mystery 
to itself, there is to be a system of public costing and 
audit, on the basis of which the industry will assume a 
collective liability for those firms which are shown to 
be competently managed. Instead of the workers being 
dismissed in slack times to struggle along as best they 
can, they are to be maintained from a fund raised by a 
levy on employers and administered by the trade unions. 
There is to be publicity as to costs and profits, open 
dealing and honest work and mutual helpfulness, in- 
stead of the competition which the nineteenth century 
regarded as an efficient substitute for them. ^' Capital " 
is not to " employ labor.'' Labor, which includes mana- 
gerial labor, is to employ capital; and to employ it at 
the cheapest rate at which, in the circumstances of the 
trade, it can be got. If it employs it so successfully 
that there is a surplus when it has been fairly paid for 
its own services, then that surplus is not to be divided 
among shareholders, for, when they have been paid 
interest, they have been paid their due ; it is to be used ,. 
to equip the industry to provide still more effective I 
service in the future. 

So here we have the majority of a body of practical 
men, who care nothing for socialist theories, proposing 
to establish ^^ organized Public Service in the Building 
Industry," recommending, in short, that their industry \ 
shall be turned into a profession. And they do it, it 



INDUSTRY AS A PROFESSION 109 

will be observed, by just that functional organization, 
just that conversion of full proprietary rights into a 
mortgage secured (as far as efficient firms are con- 
cerned) on the industry as a v^hole, just that trans- 
ference of the control of production from the owner of 
capital to those whose business is production, which we 
saw is necessary if industry is to be organized for the 
performance of service, not for the pecuniary advan- 
tage of those who hold proprietary rights. Their 
Eeport is of the first importance as offering a policy 
for attenuating private property in capital in the im- 
portant group of industries in which private owner- 
ship, in one form or another, is likely for some 
considerable time to continue, and a valuable serv- 
ice would be rendered by any one who would work 
out in detail the application of its principle to other 
trades. 

N'ot, of course, that this is the only way, or in highly 
capitalized industries the most feasible way, in which 
the change can be brought about. Had the movement 
against the control of production by property taken 
place before the rise of limited companies, in which 
ownership is separated from management, the transition 
to the organization of industry as a profession might 
also have taken place, as the employers and workmen 
in the building trade propose that it should, by limit- 
ing the rights of private ownership without abolishing 
it. But that is not what has actually happened, and 
therefore the proposals of the building trade are not of 
universal application. It is possible to retain private 
ownership in building and in industries like building, 



110 THE ACQUISITIVE SOCIETY 

while changing its character, precisely because in build- 
ing the employer is normally not merely an owner, but 
something else as well. He is a manager ; that is, he is 
a workman. And because he is a workman, whose in- 
terests, and still more whose professional spirit as a 
workman may often outweigh his interests and merely 
financial spirit as an owner, he can form part of the 
productive organization of the industry, after his rights 
as an owner have been trimmed and limited. 

But that dual position is abnormal, and in the highly 
organized industries is becoming more abnormal every 
year. In coal, in cotton, in ship-building, in many 
branches of engineering the owner of capital is not, as 
he is in building, an organizer or manager. His con- 
nection with the industry and interest in it is purely 
financial. He is an owner and nothing more. And be- 
cause his interest is merely financial, so that his con- 
cern is dividends and production only as a means to 
dividends, he cannot be worked into an organization of 
industry which vests administration in a body repre- 
senting all grades of producers, or producers and con- 
sumers together, for he has no purpose in common with 
them ; so that while joint councils between workers and 
managers may succeed, joint councils between workers 
and owners or agents of owners, like most of the so- 
called Whitley Councils, will not, because the necessity 
for the mere owner is itself one of the points in dispute. 
The master builder, who owns the capital used, can be 
included, not qua capitalist, but qua builder, if he sur- 
renders some of the rights of ownership, as the Build- 
ing Industry Committee proposed that he should. But 



INDUSTEY AS A PROFESSION 111 

if the shareholder in a colliery or a shipyard abdicates 
the control and unlimited profits to which, qua capi- 
talist, he is at present entitled, he abdicates everything 
that makes him what he is, and has no other standing 
in the industry. lie cannot share, like the master 
builder, in its management, because he has no qualifi- 
cations which would enable him to do so. His object 
is profit; and if industry is to become, as employers 
and workers in the building trade propose, an '^ organ- 
ized public service," then its subordination to the share- 
holder whose object is profit, is, as they clearly see, 
precisely what must be eliminated. The master builders 
propose to give it up. They can do so because tkey have 
their place in the industry in virtue of their function 
as workmen. But if the shareholder gave it up, he 
would have no place at all. 

Hence in coal mining, where ownership and manage- 
ment are sharply separated, the owners will not admit 
the bare possibility of any system in which the control 
of the administration of the mines is shared between 
the management and the miners. ^^ I am authorized to 
state on behalf of the Mining Association,'' Lord Gain- 
ford, the chief witness on behalf of the mine-owners, 
informed the Coal Commission, " that if the owners are 
not to be left complete executive control they will de- 
cline to accept the responsibility for carrying on the 
industry." ^ So the mine-owners blow away in a sen- 
tence the whole body of plausible make-believe which 
rests on the idea that, while private ownership remains 

* Coal Industry Commission, Minutes of Evidence, Vol. I, p. 
2506. 



112 THE ACQUISITIVE SOCIETY 

unaltered, industrial harmony can be produced by the 
magic formula of joint control. And they are right. 
The representatives of workmen and shareholders, in 
mining and in other industries, can meet and negotiate 
and discuss. But joint administration of the share- 
holders' property by a body representing shareholders 
and workmen is impossible, because there is no purpose 
in common between them. Eor the only purpose which 
could unite all persons engaged in industry, and over- 
rule their particular and divergent interests, is the 
provision of service. And the object of shareholders, 
the whole significance and metier of industry to them, 
is not the provision of service but the provision of 
dividends. 

In industries where management is divorced from 
ownership, as in most of the highly organized trades it 
is to-day, there is no obvious halfway house, therefore, 
between the retention of the present system and the com- 
plete extrusion of the capitalist from the control of pro- 
duction. The change in the character of ownership, 
which is necessary in order that coal or textiles and 
ship-building may be organized as professions for the 
service of the public, cannot easily spring from within. 
The stroke needed to liberate them from the control of 
the property-owner must come from without. In theory 
it might be struck by action on the part of organized 
workers, who would abolish residuary profits and the 
right of control by the mere procedure of refusing to 
work as long as they were maintained, on the historical 
analogy offered by peasants who have destroyed preda- 



INDUSTRY AS A PROFESSION 113 

tory property in the past by declining to pay its dues 
and admit its government, in which case Parliament 
would intervene only to register the community's assent 
to the fait accompli. In practice, however, the condi- 
tions of modern industry being what they are, that 
course, apart from its other disadvantages, is so un- 
likely to be attempted, or, if attempted, to succeed, that 
it can be neglected. The alternative to it is that the 
change in the character of property should be affected 
by legislation in virtue of which the rights of ownership 
in an industry are bought out simultaneously. 

In either case, though the procedure is different, the 
result of the change, once it is accomplished, is the 
same. Private property in capital, in the sense of 
the right to profits and control, is abolished. What 
remains of it is, at most, a mortgage in favor of the 
previous proprietors, a dead leaf which is preserved, 
though the sap of industry no longer feeds it, as long 
as it is not thought worth while to strike it off. And 
since the capital needed to maintain and equip a modern 
industry could not be provided by any one group of 
workers, even were it desirable on other grounds that 
they should step completely into the position of the pres- 
ent owners, the complex of rights which constitutes 
ownership remains to be shared between them and what- 
ever organ may act on behalf of the general community. 
The former, for example, may be the heir of the present 
owners as far as the control of the routine and adminis- 
tration of industry is concerned : the latter may suc- 
ceed to their right to dispose of residuary profits. The 
elements composing property, have, in fact, to be dis- 



114 THE ACQUISITIVE SOCIETY 

entangled : and the fact that to-day, under the common 
name of ownership, several different powers are vested 
in identical hands, must not be allowed to obscure the 
probability that, once private property in capital has 
been abolished, it may be expedient to re-allocate those 
powers in detail as well as to transfer them en hloc. 

The essence of a profession is, as we have suggested, i 
that its members organize themselves for the perform- \ 
ance of function. It is essential therefore, if industry is 
to be professionalized, that the abolition of functionless 
property should not be interpreted to imply a continu- 
ance under public ownership of the absence of respon- 
sibility on the part of the personnel of industry, which 
is the normal accompaniment of private ownership 
working through the wage-system. It is the more im- 
portant to emphasize that point, because such an impli- 
cation has sometimes been conveyed in the past by some 
of those who have presented the case for some such 
change in the character of ownership as has been urged 
above. The name consecrated by custom to the trans- 
formation of property by public and external action is 
nationalization. But nationalization is a word which 
is neither very felicitous nor free from ambiguity. 
Properly used, it means merely ownership by a body 
representing the nation. But it has come in practice 
to be used as equivalent to a particular method of ad- 
ministration, under which officials employed by the 
State step into the position of the present directors of 
industry, and exercise all the power which they exer- 
cised. So those who desire to maintain the system 
under which industry is carried on, not as a profession 



INDUSTEY AS A PROFESSION 115 

serving the public, but for the advantage of share- 
holders, attack nationalization on the ground that state 
management is necessarily inefficient, and tremble with 
apprehension whenever they post a letter in a letter-box; 
and those who desire to change it reply that state serv- 
ices are efficient and praise God whenever they use a 
telephone; as though either private or public adminis- 
tration had certain peculiar and unalterable character- 
istics, instead of depending for its quality, like an army 
or railway company or school, and all other undertak- 
ings, public and private alike, not on whether those 
who conduct it are private officials or state officials, but 
on whether they are properly trained for their work 
and can command the good will and confidence of their 
subordinates. 

The arguments on both sides are ingenious, but in 
reality nearly all of them are beside the point. The 
merits of nationalization do not stand or fall with the 
efficiency or inefficiency of existing state departments 
as administrators of industry. For nationalization, 
which means public ownership, is compatible with sev- 
eral different types of management. The constitution 
of the industry may be " unitary," as is (for example) 
that of the post-office. Or it may be " federal," as was 
that designed by Mr. Justice Sankey for the Coal In- 
dustry. Administration may be centralized or decen- 
tralized. The authorities to whom it is intrusted may 
be composed of representatives of the consumers, or of 
representatives of professional associations, or of state 
officials, or of all three in several diiferent proportions. 
Executive work may be placed in the hands of civil 



116 THE ACQUISITIVE SOCIETY 

servants, trained, recruited and promoted as in the 
existing state departments, or a new service may be 
created with a procedure and standards of its own. It 
may be subject to Treasury control, or it may be finan- 
cially autonomous. The problem is, in fact, of a 
familiar, though difiicult, order. It is one of constitu- 
tion-making. 

It is commonly assumed by controversialists that the 
organization and management of a nationalized in- 
dustry must, for some undefined reason, be similar to 
that of the post-office. One might as reasonably suggest 
that the pattern exemplar of private enterprise must 
be the Steel Corporation or the Imperial Tobacco Com- 
pany. The administrative systems obtaining in a so- 
ciety which has nationalized its foundation industries 
will, in fact, be as various as in one that resigns them 
to private ownership; and to discuss their relative ad- 
vantages without defining what particular type of each 
is the subject of reference is to-day as unhelpful as to 
approach a modern political problem in terms of the 
Aristotelian classification of constitutions. The highly 
abstract dialectics as to " enterprise," " initiative,'' 
" bureaucracy," '' red tape," " democratic control," 
" state management," which fill the press of countries 
occupied with industrial problems, really belong to the 
dark ages of economic thought. The first task of the 
student, whatever his personal conclusions, is, it may be 
suggested, to contribute what he can to the restoration 
of sanity by insisting that instead of the argument being 
conducted with the counters of a highly inflated and 
rapidly depreciating verbal currency, the exact situation.. 



INDUSTKY AS A PEOFESSION 117 

in so far as is possible, shall be stated as it is; uncer- 
tainties (of which there are many) shall be treated as 
uncertain, and the precise meaning of alternative pro- 
posals shall be strictly defined. Not the least of the 
merits of Mr. Justice Sankey's report was that, by stat- 
ing in great detail the type of organization which he 
recommended for the Coal Industry, he imparted a new 
precision and reality into the whole discussion. Whether 
his conclusions are accepted or not, it is from the basis 
of clearly defined proposals such as his that the future 
discussion of these problems must proceed. It may not 
find a solution. It will at least do something to create 
the temper in which alone a reasonable solution can be 
sought. 

E'ationalization, then, is not an end, but a means to 
an end, and when the question of ownership has been 
settled the question of administration remains for solu- 
tion. As a means it is likely to be indispensable in those 
industries in which the rights of private proprietors 
cannot easily be modified without the action of the 
State, just as the purchase of land by county councils 
is a necessary step to the establishment of small holders, 
when landowners will not voluntarily part with their 
property for the purpose. But the object in purchasing 
land is to establish small holders, not to set up farms 
administered by state ofiicials; and the object of na- 
tionalizing mining or railways or the manufacture of 
steel should not be to establish any particular form of 
state management, but to release those who do construc- 
tive work from the control of those whose sole interest 
is pecuniary gain, in order that they may be free to 



118 THE ACQUISITIVE SOCIETY 

apply their energies to the true purpose of industry, 
which is the provision of service, not the provision of 
dividends. When the transference of property lias 
taken place, it v^ill probably be found that the neces- 
sary provision for the government of industry will in- 
volve not merely the freedom of the producers to pro- 
duce, but the creation of machinery through which the 
consumer, for whom he produces, can express his wishes 
and criticize the way in which they are met, as at pres- 
ent he normally cannot. But that is the second stage 
in the process of reorganizing industry for the per- 
formance of function, not the first. The first is to free 
it from subordination to the pecuniary interests of the 
owner of property, because they are the magnetic pole 
which sets all the compasses wrong, and which causes 
industry, however swiftly it may progress, to progress 
in the wrong direction. 

^or does this change in the character of property 
involve a breach with the existing order so sharp as to 
be impracticable. The phraseology of political contro- 
versy continues to reproduce the conventional antith- 
eses of the early nineteenth century ; " private enter- 
prise '' and " public ownership " are still contrasted 
with each other as light with darkness or darkness with 
light. But, in reality, behind the formal shell of the 
traditional legal system the elements of a new body of 
relationship have already been prepared, and find piece- 
meal application through policies devised, not by 
socialists, but by men who repeat the formulse of in- 
dividualism, at the very moment when they are under- 
mining it. The Esch-Cummins Act in America^ the 



INDUSTRY AS A PROFESSION 119 

Act establishing a Ministry of Transport in England, 
Sir Arthur Duckham's scheme for the organization of 
the coal mines, the proposals with regard to the coal in- 
dustry of the British Government itself, appear to have 
the common characteristic of retaining private ov^ner- 
ship in name, while attenuating it in fact, by placing 
its operators under the supervision, accompanied some- 
times by a financial guarantee, of a public authority. 
Schemes of this general character appear, indeed, to be 
the first instinctive reaction produced by the discovery 
that private enterprise is no longer functioning eifec- 
tively ; it is probable that they possess certain merits of 
a technical order analogous to those associated with the 
amalgamation of competing firms into a single combina- 
tion. It is questionable, however, whether the com- 
promise which they represent is permanently tenable. 
What, after all, it may be asked, are the advantages of 
private ownership when it has been pared down to the 
point which policies of this order propose? May not 
the " owner " whose rights they are designed to protect 
not unreasonably reply to their authors, " Thank you 
for nothing " ? Individual enterprise has its merits : 
60 also, perhaps, has public ownership. But, by the time 
these schemes have done with it, not much remains of 
" the simple and obvious system of natural liberty," 
while their inventors are precluded from appealing to 
the motives which are emphasized by advocates of na- 
tionalization. It is one thing to be an entrepreneur 
with a world of adventure and unlimited profits — if 
they can be achieved — before one. It is quite another 
to be a director of a railway company or coal corpora- 



120 THE ACQUISITIVE SOCIETY 

tion with a minimum rate of profit guaranteed by the 
State, and a maximum rate of profit which cannot be 
exceeded. Hybrids are apt to be sterile. It may be 
questioned whether, in drawing the teeth of private 
capitalism, this type of compromise does not draw out 
most of its virtues as well. 

So, when a certain stage of economic development 
has been reached, private ownership, by the admission 
of its defenders, can no longer be tolerated in the only 
form in which it is free to display the characteristic, 
and quite genuine, advantages for the sake of which it 
used to be defended. And, as step by step it is whittled 
down by tacit concessions to the practical necessity of 
protecting the consumer, or eliminating waste, or meet- 
ing the claims of the workers, public ownership becomes, 
not only on social grounds, but for reasons of economic 
efiSciency, the alternative to a type of private ownership 
which appears to carry with it few rights of ownership 
and to be singularly devoid of privacy. Inevitably and 
unfortunately the change must be gradual. But it 
should be continuous. When, as in the last few years, 
the State has acquired the ownership of great masses 
of industrial capital, it should retain it, instead of sur- 
rendering it to private capitalists, who protest at once 
that it will be managed so inefficiently that it will not 
pay and managed so efficiently that it will undersell 
them. When estates are being broken up and sold, as 
they are at present, public bodies should enter the 
market and acquire them. Most important of all, the 
ridiculous barrier, inherited from an age in which 
municipal corporations were corrupt oligarchies, which 



INDUSTRY AS A PEOFESSION . 121 

at present prevents England's Local Authorities from 
acquiring property in land and industrial capital, ex- 
cept for purposes specified by Act of Parliament, should 
be abolished, and they should be free to undertake such 
sendees as the citizens may desire. The objection to 
public ownership, in so far as it is intelligent, is in 
reality largely an objection to over-centralization. But 
the remedy for over-centralization, is not the mainte- 
nance of functionless property in private hands, but the 
decentralized ownership of public property, and when 
Birmingham and Manchester and Leeds are the little 
republics which they should be, there is no reason to 
anticipate that they will tremble at a whisper from 
Whitehall. 

These things should be done steadily and contin- 
uously quite apart from the special cases like that of the 
mines and railways, where the private ownership of 
capital is stated by the experts to have been responsible 
for intolerable waste, or the manufacture of ornaments 
and alcoholic liquor, which are politically and socially 
too dangerous to be left in private hands. They should 
be done not in order to establish a single form of bureau- 
cratic management, but in order to release the industry 
from the domination of proprietary interests, which, 
whatever the form of management, are not merely 
troublesome in detail but vicious in principle, because 
they divert it from the performance of function to the 
acquisition of gain. If at the same time private owner- 
ship is shaken, as recently it has been, by action on the 
part of particular groups of workers, so much the 
better. There are more ways of killing a cat than 



122 THE ACQUISITIVE SOCIETY 

drowning it in cream, and it is all the more likely to 
choose the cream if they are explained to it. But the 
two methods are complementary, not alternative, and 
the attempt to found rival schools on an imaginary in- 
compatibility between them is a bad case of the odium ». 
sociologicum which afflicts reformers. -* 



VIII 

THE ^^ VICIOUS CIRCLE" 

What form of management should replace the admin- 
istration of industry by the agents of shareholders? 
What is most likely to hold it to its main purpose, and 
to be least at the mercy of predatory interests and func- 
tionless supernumeraries, and of the alternations of 
sullen dissatisfaction and spasmodic revolt which at 
present distract it? Whatever the system upon which 
industry is administered, one thing is certain. Its eco- 
nomic processes and results must be public, because only 
if they are public can it be known whether the service 
of industry is vigilant, effective and honorable, whether 
its purpose is being realized and its function carried 
out. The defense of secrecy in business resembles the 
defense of adulteration on the ground that it is a legit- 
imate weapon of competition; indeed it has even less 
justification than that famous doctrine, for the condition 
of effective competition is publicity, and one motive for 
secrecy is to prevent it. 

Those who conduct industry at the present time and 
who are most emphatic that, as the Duke of Wellington 
said of the unreformed House of Commons, they " have 
never read or heard of any measure up to the present 
moment which can in any degree satisfy the mind " that 
the method of conducting it can in any way be im- 
proved, are also those apparently who, with some honor- 

123 



124 THE ACQUISITIVE SOCIETY 

able exceptions, are most reluctant that the full facts 
about it should be known. And it is crucial that they 
should be known. It is crucial not only because, in the 
present ignorance of the real economic situation, all 
industrial disagreements tend inevitably to be battles in 
the dark, in which " ignorant armies clash by night," 
but because, unless there is complete publicity as to 
profits and costs, it is impossible to form any judgment 
either of the reasonableness of the prices which are 
charged or of the claims to remuneration of the different 
parties engaged in production. For balance sheets, with 
their opportunities for concealing profits, give no clear 
light upon the first, and no light at all upon the second. 
And so, when the facts come out, the public is aghast 
at revelations which show that industry is conducted 
with bewildering financial extravagance. If the full 
facts had been published, as they should have been, 
quarter by quarter, these revelations would probably 
not have been made at all, because publicity itself would 
have been an antiseptic and there would have been noth- 
ing sensational to reveal. 

The events of the last few years are a lesson which 
should need no repetition. The Government, surprised 
at the price charged for making shells at a time when 
its soldiers were ordered by Headquarters not to fire 
more than a few rounds per day, whatever the need for 
retaliation, because there were not more than a few to 
fire, establishes a costing department to analyze the 
estimates submitted by manufacturers and to compare 
them, item by item, with the costs in its own factories. 
It finds that, through the mere pooling of knowledge, 



THE " VICIOUS CIRCLE ^' 125 

'^ some of the reductions made in the price of shells and 
similar munitions/' as the Chartered Accountant em- 
ployed by the Department tells us, " have been as higb 
as 50% of the original price." The household con- 
sumer grumbles at the price of coal. For once in a 
way, amid a storm of indignation from influential per- 
sons engaged in the industry, the facts are published. 
And what do they show? That, after 2/6 has been 
added to the already high price of coal because the 
poorer mines are alleged not to be paying their way, 
21% of the output examined by the Commission was 
produced at a profit of 1/- to 3/- per ton, 32% at a profit 
of 3/- to 5/-, 13% at a profit of 5/- to 7/-, and 14% 
at a profit of YA per ton and over, while the profits of 
distributors in London alone amount in the aggregate 
to over $3,200,000, and the co-operative movement, 
which aims not at profit, but at service, distributes 
household coal at a cost of from 2/- to 4/- less per ton 
than is charged by the coal trade ! ^ 

" But these are exceptions." They may be. It is 
possible that in the industries, in which, as the recent 
Committee on Trusts has told us, " powerful Combina- 
tions or Consolidations of one kind or another are in a 
position effectively to control output and prices," not 
only costs are cut to the bare minimum but profits are 
inconsiderable. But then why insist on this humiliating 
tradition of secrecy with regard to them, when every one 
who uses their products, and every one who renders hon- 
est service to production, stands to gain by publicity? 
If industry is to become a profession, whatever its man- 

* Coal Industry Commission, Minutes of Evidence, pp. 9261-9. 



126 THE ACQUISITIVE SOCIETY 

agement, the first of its professional rules should be, as 
Sir John Mann told the Coal Commission, that '' ail 
cards should be placed on the table." If it were the 
duty of a Public Department to publish quarterly exact 
returns as to costs of production and profits in all the 
firms throughout an industry, the gain in mere produc- 
tive efficiency, which should appeal to our enthusiasts 
for output, would be considerable ; for the organization 
whose costs were least would become the standard with 
which all other types of organization would be com- 
pared. The gain in morale, which is also, absurd 
though it may seem, a condition of efficiency, would be 
incalculable. For industry would be conducted in the 
light of day. Its costs, necessary or unnecessary, the 
distribution of the return to it, reasonable or capricious, 
would be a matter of common knowledge. It would be 
held to its purpose by the mere impossibility of per- 
suading those who make its products or those who con- 
sume them to acquiesce, as they acquiesce now, in ex- 
penditure which is meaningless because it has contrib- 
uted nothing to the service which the industry exists 
to perform. 

The organization of industry as a profession does not 
involve only the abolition of functionless property, and 
the maintenance of publicity as the indispensable con- 
dition of a standard of professional honor. It implies 
also that those who perform its work should undertake 
that its work is performed effectively. It means that 
they should not merely be held to the service of the 
public by fear of personal inconvenience or penalties, 
but that they should treat the discharge of professional 



THE " VICIOUS CIRCLE '' 127 

responsibilities as an obligation attaching not only to a 
small elite of intellectuals, managers or " bosses," who 
perform the technical work of " business management/' 
but as implied by the mere entry into the industry and 
as resting on the corporate consent and initiative of the 
rank and file of workers. It is precisely, indeed, in the 
degree to which that obligation is interpreted as attach- 
ing to all workers, and not merely to a select class, that 
the difference between the existing industrial order, 
collectivism and the organization of industry as a pro- 
fession resides. The first involves the utilization of 
hu^lan beings for the purpose of private gain; the 
second their utilization for the purpose of public 
service; the third the association in the service of the 
public of their professional pride, solidarity and organi- 
zation. 

The difference in administrative machinery between 
the second and third might not be considerable. Both 
involve the drastic limitation or transference to the 
public of the proprietary rights of the existing owners 
of industrial capital. Both would necessitate machinery 
for bringing the opinion of the consumers to bear upon 
the service supplied them by the industry. The differ- 
ence consists in the manner in which the obligations of 
the producer to the public are conceived. He may either 
be the executant of orders transmitted to him by its 
agents; or he may, through his organization, himself 
take a positive part in determining what those orders 
should be. In the former case he is responsible for his 
own work, but not for anything else. If he hews his 
stint of coal, it is no business of his whether the pit is a 



128 THE ACQUISITIVE SOCIETY 

failure; if he puts in the normal number of rivets, he 
disclaims all further interest in the price or the sea- 
worthiness of the ship. In the latter his function em- 
braces something more than the performance of the 
specialized piece of work allotted to him. It includes 
also a responsibility for the success of the undertaking 
as a whole. And since responsibility is impossible with- 
out power, his position would involve at least so much 
power as is needed to secure that he can affect in prac- 
tice the conduct of the industry. It is this collective lia- 
bility for the maintenance of a certain quality of serv- 
ice which is, indeed, the distinguishing feature of a 
profession. It is compatible with several different kinds 
of government, or indeed, when the unit of production is 
not a group, but an individual, with hardly any govern- 
ment at all. What it does involve is that the individual, 
merely by entering the profession should have com- 
mitted himself to certain obligations in respect of its 
conduct, and that the professional organization, what- 
ever it may be, should have sufficient power to enable it 
to maintain them. 

The demand for the participation of the workers in 
the control of industry is usually advanced in the name 
of the producer, as a plea for economic freedom or in- 
dustrial democracy. ^' Political freedom," writes the 
Final Eeport of the United States Commission of In- 
dustrial Eelations, which was presented in 1916, ^' can 
exist only where there is industrial freedom. . . . 
There are now within the body of our Republic indus- 
trial communities which are virtually Principalities, 
oppressive to those dependent upon them for a livelihood 



THE " VICIOUS CIRCLE '' 129 

and a dreadful menace to the peace and welfare of the 
nation." The vanity of Englishmen may soften the 
shadows and heighten the lights. But the concentration 
of authority is too deeply rooted in the very essence of 
Capitalism for differences in the degree of the arbitrari- 
ness with which it is exercised to be other than trivial. 
The control of a large works does, in fact, confer a kind 
of private jurisdiction in matters concerning the life 
and livelihood of the workers, which, as the United 
States' Commission suggests, may properly be described 
as ^^ industrial feudalism." It is not easy to understand 
how the traditional liberties of Englishmen are com- 
patible with an organization of industry which, except 
in so far as it has been qualified by law or trade union- 
ism, permits populations almost as large as those of 
some famous cities of the past to be controlled in their 
rising up and lying down, in their work, economic op- 
portunities, and social life by the decisions of a Com- 
mittee of half-a-dozen Directors. 

The most conservative thinkers recognize that the 
present organization of industry is intolerable in the 
. sacrifice of liberty which it entails upon the producer. 
But each effort which he makes to emancipate himself 
is met by a protest that if the existing system is incom- 
patible with freedom, it at least secures eflScient service, 
and that efficient service is threatened by movements 
which aim at placing a greater measure of industrial 
control in the hands of the workers. The attempt to 
drive a wedge between the producer and the consumer 
is obviously the cue of all the interests which are con- 
scious that by themselves they are unable to hold back 



130 THE ACQUISITIVE SOCIETY 

the flood. It is natural, therefore, that during the last 
few months they should have concentrated their efforts 
upon representing that every advance in the demands 
and in the power of any particular group of workers is 
a new imposition upon the general hody of the public. 
Eminent persons, who are not obviously producing more 
than they consume, explain to the working classes that 
unless they produce more they must consume less. 
Highly syndicated combinations warn the public 
against the menace of predatory syndicalism. The 
owners of mines and minerals, in their new role as pro- 
tectors of the poor, lament the " selfishness " of the 
miners, as though nothing but pure philanthropy had 
hitherto caused profits and royalties to be reluctantly 
accepted by themselves. 

The assumption upon which this body of argument 
rests is simple. It is that the existing organization of 
industry is the safeguard of productive efficiency, and 
that from every attempt to alter it the workers them- 
selves lose more as consumers than they can gain as 
producers. The world has been drained of its wealth 
and demands abundance of goods. The workers de- 
mand a larger income, greater leisure, and a more se- 
cure and dignified status. These two demands, it is 
argued, are contradictory. For how can the consumer 
be supplied with cheap goods, if, as a worker, he insists 
on higher wages and shorter hours ? And how can the 
worker secure these conditions, if as a consumer, he 
demands cheap goods? So industry, it is thought, 
moves in a vicious circle of shorter hours and higher 
wages and less production, which in time must mean 



THE '^ VICIOUS CIRCLE'' 131 

longer hours and lower wages; and every one receives 
less, because every one demands more. 

The picture is plausible, but it is fallacious. It is 
fallacious not merely in its crude assumption that a 
rise in wages necessarily involves an increase in costs, 
but for another and more fundamental reason. In real- 
ity the cause of economic confusion is not that the 
demands of producer and consumer meet in blunt op- 
position; for, if they did, their incompatibility, when 
they were incompatible, would be obvious, and neither 
could deny his responsibility to the other, however much 
he might seek to evade it. It is that they do not, but 
that, as industry is organized to-day, what the worker 
foregoes the general body of consumers does not neces- 
sarily gain, and what the consumer pays the general 
body of workers does not necessarily receive. If the 
circle is vicious, its vice is not that it is closed, but 
that it is always half open, so that part of production 
leaks away in consumption which adds nothing to pro- 
ductive energies, and that the producer, because he 
knows this, does not fully use even the productive energy 
which he commands. 

It is the consciousness of this leak which sets every 
one at cross purposes. "No conceivable system of indus- 
trial organization can secure industrial peace, if by 
" peace " is meant a complete absence of disagreement. 
What could be secured would be that disagreements 
should not flare up into a beacon of class warfare. If 
every member of a group puts something into a common 
pool on condition of taking something out, they may still 
quarrel about the size of the shares, as children quarrel 



132 THE ACQUISITIVE SOCIETY 

over cake ; but if the total is known and the claims ad- 
mitted, that is all thej can quarrel about, and, since 
they all stand on the same footing, any one who holds 
out for more than his fellows must show some good 
reason why he should get it. But in industry the claims 
are not all admitted, for those who put nothing in de- 
mand to take something out ; both the total to be divided 
and the proportion in which the division takes place are 
sedulously concealed; and those who preside over the 
distribution of the pool and control what is paid out of 
it have a direct interest in securing as large a share as 
possible for themselves and in allotting as small a share 
as possible to others. If one contributor takes less, so 
far from it being evident that the gain will go to some 
one who has put something in and has as good a right 
as himself, it may go to some one who has put in nothing 
and has no right at all. If another claims more, he 
may secure it, without plundering a fellow-w^orker, at 
the expense of a sleeping partner who is believed to 
plunder both. In practice, since there is no clear prin- 
ciple determining what they ought to take, both take all 
that they can get. 

In such circumstances denunciations of the producer 
for exploiting the consumer miss the mark. They are 
inevitably regarded as an economic version of the mili- 
tary device used by armies which advance behind a 
screen of women and children, and then protest at the 
brutali|:y of the enemy in shooting non-combatants. 
They are interpreted as evidence, not that a section of 
the producers are exploiting the remainder, but that a 
.minority of property-owners, which is in opposition to 



THE "VICIOUS CIRCLE^' 133 

both, can use its economic power to make efforts di- 
rected against those who consmne much and produce 
little rebound on those who consume little and produce 
much. And the grievance, of which the Press makes 
so much, that some workers may be taking too large a 
share compared with others, is masked by the much 
greater grievance, of which it says nothing whatever, 
that some idlers take any share at all. The abolition 
of payments which are made without any correspond- 
ing economic service is thus one of the indispensable 
conditions both of economic efficiency and industrial 
peace, because their existence prevents different classes 
of workers from restraining each other, by uniting them 
all against the common enemy. Either the principle of 
industry is that of function, in which case slack work 
is only less immoral than no work at all ; or it is that of 
grab, in which case there is no morality in the matter. 
But it cannot be both. And it is useless either for prop- 
erty-owners or for Governments to lamient the mote in 
the eye of the trade unions as long as, by insisting on the 
maintenance of functionless property, they decline to 
remove the beam in their own. 

The truth is that only workers can prevent the abuse 
of power by workers, because only workers are recog- 
nized as possessing any title to have their claims con- 
sidered. And the first step to preventing the exploita- 
tion of the consumer by the producer is simple. It is 
to turn all men into producers, and thus to remove the 
temptation for particular groups of workers to force 
their claims at the expense of the public, by removing 
the valid excuse that such gains as they may get ar^ 



134 THE ACQUISITIVE SOCIETY 

taken from those who at present have no right to them, 
because they are disproportionate to service or obtained 
for no service at all. Indeed, if work were the only 
title to payment, the danger of the community being ex- 
ploited by highly organized groups of producers would 
largely disappear. For, when no payments were made 
to non-producers, there would be no debatable ground 
for which to struggle, and it would become evident that 
if any one group of producers took more, another must 
put up with less. 

Under such conditions a body of workers who used 
their strong strategic position to extort extravagant 
terms for themselves at the expense of their fellow- 
workers might properly be described as exploiting the 
community. But at present such a statement is mean- 
ingless. It is meaningless because before the commun- 
ity can be exploited the community must exist, and its 
existence in the sphere of economics is to-day not a fact 
but only an aspiration. The procedure by which, when- 
ever any section of workers advance demands which are 
regarded as inconvenient by their masters, they are de- 
nounced as a band of anarchists who are preying on the 
public may be a convenient weapon in an emergency, 
but, once it is submitted to analysis, it is logically self- 
destructive. It has been applied within recent years, to 
the postmen, to the engineers, to the policemen, to the 
miners and to the railway men, a population with their 
dependents, of some eight million persons; and in the 
case of the last two the whole body of organized labor 
made common cause with those of whose exorbitant de- 
mands it was alleged to be the victim. But when these 



THE "VICIOUS CIECLE" 135 

workers and their sympathizers are deducted, what is 
^^ the community '' which remains ? It is a naive arith- 
metic which produces a total by subtracting one by 
one all the items which compose it; and the art 
which discovers the public interest by eliminating 
the interests of successive sections of the public 
smacks of the rhetorician rather than of the states- 
man. 

The truth is that at present it is idle to seek to resist 
the demands of any group of workers by appeals to 
" the interests of society," because to-day, as long as 
the economic plane alone is considered, there is not one 
society but two, which dwell together in uneasy juxta- 
position, like Sinbad and the Old Man of the Sea, but 
which in spirit, in ideals, and in economic interest, are 
worlds asunder. There is the society of those who live 
by labor, whatever their craft or profession, and the 
society of those who live on it. All the latter cannot 
command the sacrifices or the loyalty which are due to 
the former, for they have no title which will bear in- 
spection. The instinct to ignore that tragic division 
instead of ending it is amiable^ and sometimes generous. 
But it is a sentimentality which is like the morbid 
optimism of the consumptive who dares not admit even 
to himself the virulence of his disease. As long as the 
division exists, the general body of workers, while it 
may suffer from the struggles of any one group within 
it, nevertheless supports them by its sympathy, because 
all are interested in the results of the contest carried 
on by each. Different sections of workers will exercise 
mutual restraint only when the termination of the 



136 THE ACQUISITIVE SOCIETY 

struggle leaves them face to face with each other, and 
not as now, with the common enemy. The ideal of a 
■united society in which no one group uses its power to 
encroach upon the standards of another is^ in short, 
unattainable, except through the preliminary abolition 
of functionless property. 

Those to whom a leisure class is part of an im- 
mutable order without which civilization is inconceiv- 
able, dare not admit, even to themselves, that the world 
is poorer, not richer, because of its existence. So, when, 
as now it is important that productive energy should be 
fully used, they stamp and cry, and write to The Times 
about the necessity for increased production, though all 
the time they themselves, their way of life and expendi- 
ture, and their very existence as a leisure class, are 
among the causes why production is not increased. In 
all their economic plans they make one reservation, that, 
however necessitous the world may be, it shall still sup- 
port them. But men who work do not make that reser- 
vation, nor is there any reason why they should; 
and appeals to them to produce more wealth because 
the public needs it usually fall upon deaf ears, even 
when such appeals are not involved in the igno- 
rance and misapprehensions which often characterize 
them. 

For the workman is not the servant of the consumer, 
for whose sake greater production is demanded, but of 
shareholders, whose primary aim is dividends, and to 
whom all production, however futile or frivolous, so 
long as it yields dividends, is the same. It is useless to 
urge that he should produce more wealth for the com- 



THE "VICIOUS CIECLE^' 137 

mimity, unless at the same time he is assured that it is 
the community which will benefit in proportion as more 
wealth is produced. If every unnecessary charge upon 
coal-getting had been eliminated, it would be reasonable 
that the miners should set a much needed example by 
refusing to extort better terms for themselves at the ex- 
pense of the public. But there is no reason why they 
should work for lower wages or longer hours as long as 
those who are to-day responsible for the management 
of the industry conduct it with " the extravagance and 
waste " stigmatized by the most eminent official witness 
before the Coal Commission, or why the consumer 
should grumble at the rapacity of the miner as long as 
he allows himself to be mulcted by swollen profits, the 
costs of an ineffective organization, and unnecessary 
payments to superfluous middlemen. 

If to-day the miner or any other workman produces 
more, he has no guarantee that the result will be lower 
prices rather than higher dividends and larger royal- 
ties, any more than, as a workman, he can determine 
the quality of the w^ares which his employer supplies to 
customers, or the price at which they are sold. Nor, 
as long as he is directly the servant of a profit-making 
company, and only indirectly the servant of the com- 
munity, can any such guarantee be offered him. It can 
be offered only in so far as he stands in an immediate 
and direct relation to the public for wKom industry is 
carried on, so that, when all costs have been met, any 
surplus will pass to it, and not to private individuals. 
It will be accepted only in so far as the workers in each 
industry are not merely servants executing orders, but 



138 THE ACQUISITIVE SOCIETY 

themselves have a collective responsibility for the char- 
acter of the service, and can use their organizations not 
merely to protect themselves against exploitation, but 
to make positive contributions to the administration and 
development of their industry. 



IX 

THE CONDITION OF EFFICIENCY 

Thus it is not only for the sake of the producers, on 
whom the old industrial order weighed most heavily, 
that a new industrial order is needed. It is needed for 
the sake of the consum ers, because the ability on which 
the old industrial order prided itself most and which 
is flaunted most as an argument against change, the 
ability to serve them effectively, is itself visibly break- 
ing down. It is breaking down at what was always its 
most vulnerable point, the control of the human beings 
whom, with characteristic indifference to all but their 
economic significance, it distilled for its own purposes 
into an abstraction called " Labor." The first symptom 
of its collapse is what the first symptom of economic 
collapses has usually been in the past — the failure of 
customary stimuli to evoke their customary response in 
human effort. 

Till that failure is recognized and industry reorgan- 
ized so that new stimuli may have free play, the col- 
lapse will not correct itself, but, doubtless with spas- 
modic revivals and flickerings of energy, will continue 
and accelerate. The cause of it is simple. It is that 
those whose business it is to direct economic activity are 
increasingly incapable of directing the men upon whom 
economic activity depends. The fault is not that of in- 
dividuals, but of a system, of Industrialism itself. 

139 



140 THE ACQUISITIVE SOCIETY 

Du£ingjth^^re^ter_jia^ nineteentk .century in- 

dustry was driven by two forces, hunger and fear, and 
the employer commanded them both. He could grant 
or withhold employment as he pleased. If men revolted 
against his terms he could dismiss them, and if they 
were dismissed what confronted them was starvation 
or the workhouse. Authority was centralized ; its in- 
struments were passive; the one thing which they 
dreaded was unemployment. And since they could 
neither prevent its occurrence nor do more than a little 
to mitigate its horrors when it occurred, they submitted 
to a discipline which they could not resist, and industry 
pursued its course through their passive acquiescence 
in a power which could crush them individually if they 
attempted to oppose it. 

That system might be lauded as efficient or denounced 
as inhuman. But, at least, as its admirers were never 
tired of pointing out, it worked. And, like the Prussian 
State, which alike in its virtues and deficiencies it not 
a little resembled, as long as it worked it survived de- 
nunciations of its methods, as a strong man will throw 
off a disease. But to-day it is ceasing to have even the 
qualities of its defects. It is ceasing to be efficient. It 
no longer secures the ever-increasing output of wealth 
which it offered in its golden prime, and which enabled 
it to silence criticism by an imposing spectacle of ma- 
terial success. Though it still works, it works unevenly, 
amid constant friction and jolts and stoppages, without 
the confidence of the public and without full confidence 
even in itself, a tyrant who must intrigue and. cajole 
where formerly he commanded, a gaoler who, if not yet 



THE CONDITION OF EFFICIENCY 141 

deprived of whip, dare only administer moderate chas- 
tisement, and who, though he still protests that he 
alone can keep the treadmill moving and get the corn 
ground, is compelled to surrender so much of his author- 
ity as to make it questionable whether he is worth his 
keep. For the instruments through which Capitalism 
exercised discipline are one by one being taken from 
it. It cannot pay what wages it likes or work what 
hours it likes. In well-organized industries the power 
of arbitrary dismissal, the very center of its authority, 
is being shaken, because men will no longer tolerate a 
system which makes their livelihood dependent on the 
caprices of an individual. In all industries alike the 
time is not far distant when the dread of starvation can 
no longer be used to cow dissatisfied workers into sub- 
mission, because the public will no longer allow invol- 
untary unemployment to result in starvation. 

And if Capitalism is losing its control of men's bodies, 
still more has it lost its command of their minds. The 
product of a civilization which regarded " the poor " as 
instruments, at worst of the luxuries, at best of the vir- 
tues, of the rich, its psychological foundation fifty years 
ago was an ignorance in the mass of mankind which led 
them to reverence as wisdom the very follies of their 
masters, and an almost animal incapacity for responsi- 
bility. Education and experience have destroyed the 
passivity which was the condition of the perpetuation 
of industrial government in the hands of an oligarchy 
of private capitalists. The workman of to-day has as 
little belief in the intellectual superiority of many of 
those who direct industry as he has in the morality of 



U2 THE ACQUISITIVE SOCIETY 

the system. It appears to him to be not only oppres- 
sive, but wasteful, unintelligent and inefficient. In the 
light of his own experience in the factory and the 
mine, he regards the claim of the capitalist to be the 
self-appointed guardian of public interests as a piece of 
sanctimonious hypocrisy. For he sees every day that 
efficiency is sacrificed to shortsighted financial interests; 
and while as a man he is outraged by the inhumanity of 
the industrial order, as a professional who knows the 
difference between good work and bad he has a growing 
contempt at once for its misplaced parsimony and its 
misplaced extravagance, for the whole apparatus of 
adulteration, advertisement and quackery which seems 
inseparable from the pursuit of profit as the main stand- 
ard of industrial success. 
.\j So Capitalism no longer secures strenuous work by 
fear, for it is ceasing to be formidable. And it can- 
not secure it by respect, for it has ceased to be re- 
spected. And the very victories by which it seeks to 
reassert its waning prestige are more disastrous than 
defeats. Employers may congratulate themselves that 
they have maintained intact their right to freedom of 
management, or opposed successfully a demand for 
public ownership, or broken a movement for higher 
wages and shorter hours. But what is success in a trade 
dispute or in a political struggle is often a defeat in 
the workshop: the workmen may have lost, but it does 
not follow that their employers, still less that the pub- 
lic, which is principally composed of workmen, have 
won. For the object of industry is to produce goods, 
and to produce them at the lowest cost in human effort. 



THE CONDITION OF EFFICIENCY 143 

But there is no alchemy which will secure efficient pro- 
duction from the resentment or distrust of men "who 
feel contempt for the order under which they work. 
It is a commonplace that credit is the foundation of 
industry. But credit is a matter of psychology, and 
the workman has his psychology as well as the capitalist. 
If confidence is necessary to the investment of capital, 
confidence is not less necessary to the effective perform- 
ance of labor by men whose sole livelihood depends upon 
it. If they are not yet strong enough to impose their 
will, they are strong enough to resist when their masters 
would impose theirs. They may work rather than strike. 
But they will work to escape dismissal, not for the 
greater glory of a system in which they do not believe ; 
and, if they are dismissed, those who take their place 
will do the same. 

That this is one cause of a low output has been stated 
both by employers and workers in the building industry, 
and by the representatives of the miners before the Coal 
Commission. It was reiterated with impressive em- 
phasis by Mr. Justice Sankey. !Nor is it seriously con- 
tested by employers themselves. What else, indeed, do 
their repeated denunciations of ^' restriction of output " 
mean except that they have failed to organize industry 
so as to secure the efficient service which it is their 
special function to provide? N'or is it appropriate to 
the situation to indulge in full-blooded denunciations 
of the " selfishness " of the working classes. " To draw 
an indictment against a whole nation " is a procedure 
which is as impossible in industry as it is in politics. 
Institutions must be adapted to human nature, not 



144 THE ACQUISITIVE SOCIETY 

human nature to institutions. If the effect of the indus- \ 
trial system is such that a large and increasing number 
of ordinary men and women find that it offers them no 
adequate motive for economic effort, it is mere pedantry 
to denounce men and women instead of amending the 
system. 

Thus the time has come when absolutism in industry 
may still win its battles, but loses the campaign, and 
loses it on the very ground of economic efficiency which 
was of its own selection. In the period of transition, 
while economic activity is distracted by the struggle be- 
tween those who have the name and habit of power, but 
no longer the full reality of it, and those who are daily 
winning more of the reality of power but are not yet 
its recognized repositories, it is the consumer who 
suffers. He has neither the service of docile obedience, 
nor the service of intelligent co-operation. For slavery 
will work — as long as the slaves will let it ; and freedom 
will work when men have learned to be free ; but what 
will not work is a combination of the two. So the 
public goes short of coal not only because of the techni- 
cal deficiencies of the system under which it is raised 
and distributed, but because the system itself has lost 
its driving force — because the coal owners can no longer 
persuade the miners into producing more dividends for 
them and more royalties for the owners of minerals, 
while the public cannot appeal to them to put their 
whole power into serving itself, because it has chosen 
that they should be the servants, not of itself, but of 
shareholders. 

And, this dilemma is no^ as some suppose, tempo- 



THE CONDITION OF EFFICIENCY 145 

rary, the aftermath of war, or peculiar to the coal in- 
dustry, as though the miners alone were the children of 
sin which in the last few months they have been de- 
scribed to be. It is permanent ; it has spread far ; and, 
as sleeping spirits are stirred into life by education and 
one industry after another develops a strong corporate 
consciousness, it will spread further. Nor will it be 
resolved by lamentations or menaces or denunciations of 
leaders whose only significance is that they say openly 
what plain men feel privately. For the matter at bot- 
tom is one of psychology. What has happened is that 
the motives on which the industrial system relied for 
several generations to secure efficiency, secure it no 
longer. And it is as impossible to restore them, to 
revive by mere exhortation the complex of hopes and 
fears and ignorance and patient credulity and passive 
acquiescence, which together made men, fifty years 
ago, plastic instruments in the hands of industrialism, 
as to restore innocence to any others of those who have 
eaten of the tree of knowledge. 

The ideal of some intelligent and respectable business 
men, the restoration of the golden sixties, when workmen 
were docile and confiding, and trade unions were still 
half illegal, and foreign competition meant English com- 
petition in foreign countries, and prices were rising a 
little and not rising too much, is the one Utopia which 
can never be realized. The King may walk naked as 
long as his courtiers protest that he is clad; but when 
a child or a fool has broken the spell a tailor is more 
important than all their admiration. If the public, 
which suffers from the slackening of economic activity, 



146 THE ACQUISITIVE SOCIETY 

desires to end its malaise, it will not laud as admirable 
and all-sufficient the operation of motives which are 
plainly ceasing to move. It will seek to liberate new 
motives and to enlist them in its service. It will en- 
deavor to find an alternative to incentives which were 
always degrading, to those who used them as much as to 
those upon whom they were used, and which now are 
adequate incentives no longer. And the alternative 
to the discipline which Capitalism exercised through its 
instruments of unemployment and starvation is the self- 
discipline of responsibility and professional pride. 

So the demand which aims at stronger organization, 
fuller responsibility, larger powers for the sake of the 
producer as a condition of economic liberty, the demand 
for freedom, is not antithetic to the demand for more 
effective work and increased output which is being made 
in the interests of the consumer. It is complementary 
to it, as the insistence by a body of professional men, 
whether doctors or university teachers, on the mainte- 
nance of their professional independence and dignity 
against attempts to cheapen the service is not hostile 
to an efficient service, but, in the long run, a condition 
of it. The course of wisdom for the consumer would 
be to hasten, so far as he can, the transition. For, as 
at present conducted, industry is working against the 
grain. It is compassing sea and land in its efforts to 
overcome, by ingenious financial and technical expedi- 
ents, obstacles w^hich should never have existed. It is 
trying to produce its results by conquering professional 
feeling instead of using it. It is carrying not only its 
inevitable economic burdens, but an ever increasing 



THE CONDITION OF EFFICIENCY 147 

load of ill will and skepticism. It has in fact '^ shot 
the bird which caused the wind to blow " and goes about 
its business with the corpse round its neck. Compared 
with that psychological incubus, the technical deficien- 
cies of industry, serious though they often are, are a 
bagatelle, and the business men who preach the gospel 
of production without offering any plan for dealing with 
what is now the central fact in the economic situation, 
resemble a Christian apologist who should avoid dis- 
turbing the cnvanimity of his audience by carefullly 
omitting all reference either to the fall of man or the 
scheme of salvation. If it is desired to increase the out- 
put of wealth, it is not a paradox, but the statement of 
an elementary economic truism to say that active and 
constructive co-operation on the part of the rank and 
file of workers would do more to contribute to that 
result than the discovery of a new coal-field or a genera- 
tion of scientific invention. 

The first condition of enlisting on the side of con- 
structive work the professional feeling wdiich is now 
apathetic, or even hostile to it, is to secure that when 
it is given its results accrue to the public, not to the 
owner of property in capital, in land, or in other re- 
sources. For this reason the attenuation of the rights 
at present involved in the private, ownership of indus- 
trial capital, or their complete abolition, is not the de- 
mand of idealogues, but an indispensable element in a 
policy of economic efficiency, since it is the condition of 
the most effective functioning of the human beings upon 
whom, though, like other truisms, it is often forgotten, 



148 THE ACQUISITIVE SOCIETY 

economic efficiency ultimately depends. But it is only 
one element. Co-operation may range from mere ac- 
quiescence to a vigilant and zealous initiative. The 
criterion of an effective system of administration is that 
it should succeed in enlisting in the conduct of indus- 
try the latent forces of professional pride to which the 
present industrial order makes little appeal, and which, 
indeed, Capitalism, in its war upon trade union organi- 
zation, endeavored for many years to stamp out alto- 
gether. 

IsTor does the efficacy of such an appeal repose upon 
the assumption of that '^ change in human nature," 
which is the triumphant redudio ad ahsurdum ad- 
vanced by those who are least satisfied with the work- 
ing of human nature as it is. What it does involve is 
that certain elementary facts should be taken into ac- 
count, instead of, as at present, being ignored. That 
all work is distasteful and that " every man desires to 
secure the largest income with the least effort " may be 
as axiomatic as it is assumed to be. But in practice it 
makes all the difference to the attitude of the individual 
whether the collective sentiment of the group to which 
he belongs is on the side of effort or against it, and 
what standard of effort it sets. That, as employers 
complain, the public opinion of considerable groups of 
workers is against an intensification of effort as long 
as part of its result is increased dividends for share- 
holders, is no doubt, as far as mere efficiency is con- 
cerned, the gravest indictment of the existing industrial 
order. But, even when public ownership has taken the 
place of private capitalism, its ability to command ef- 



THE CONDITION OF EFFICIENCY 149 

fective service will depend ultimately upon its success 
in securing not merely that professional feeling is no 
longer an opposing force, but that it is actively enlisted 
upon the side of maintaining the highest possible stand- 
ard of efficiency which can reasonably be demanded. 

To put the matter concretely, while the existing own- 
ership of mines is a positive inducement to inefficient 
work, public ownership administered by a bureaucracy, 
if it would remove the technical deficiencies emphasized 
by Sir Eichard Redmayne as inseparable from the sepa- 
rate administration of 3,000 pits by 1,500 different 
companies, would be only too likely to miss a capital 
advantage which a different type of administration 
would secure. It would lose both the assistance to be 
derived from the technical knowledge of practical men 
who know by daily experience the points at which the 
details of administration can be improved, and the 
stimulus to efficiency springing from the corporate pride 
of a profession which is responsible for maintaining and 
improving the character of its service. Professional 
spirit is a force like gravitation, which in itself is 
neither good nor bad, but which the engineer uses, when 
he can, to do his work for him. If it is foolish to 
idealize it, it is equally shortsighted to neglect it. In 
what are described par excellence as " the services " it 
has always been recognized that esprit de corps is the 
foundation of efficiency, and all means, some wise and 
some mischievous, are used to encourage it: in prac- 
tice, indeed, the power upon which the country relied 
as its main safeguard in an emergency was the pro- 
fessional zeal of the navy and nothing else. Nor is 



150 THE ACQUISITIVE SOCIETY 

that spirit peculiar to the professions which are con- 
cerned with w^ar. It is a matter of common training, 
common responsibilities, and common dangers. In all 
cases where difficult and disagreeable work is to be done, 
the force which elicits it is normally not merely money, 
but the public opinion and tradition of the little society 
in Avhich the individual moves, and in the esteem of 
which he finds that which men value in success. 

To ignore that most powerful of stimuli as it is 
ignored to-day, and then to lament that the eiforts which 
it produces are not forthcoming, is the climax of per- 
versity. To aim at eliminating from industry the 
growth and action of corporate feeling, for fear lest an 
organized body of producers should exploit the public, is 
a plausible policy. But it is short-sighted. It is ^^ to 
pour away the baby with the bath," and to lower the 
quality of the service in an attempt to safeguard it. 
A wise system of administration would recognize that 
professional solidarity can do much of its work for it 
more effectively than it can do it itself, because the 
spirit of his profession is part of the individual and not 
a force outside him, and would make it its object to 
enlist that temper in the public service. It is only by 
that policy, indeed, that the elaboration of cumbrous 
regulations to prevent men doing what they should not, 
with the incidental result of sometimes preventing them 
from doing what they should — it is only by that policy 
that what is mechanical and obstructive in bureaucracy 
can be averted. Eor industry cannot run without laws. 
It must either control itself by professional standards, 
or it must be controlled by officials who are not of the 



THE CONDITION OF EFFICIENCY 151 

craft and who, however zealous and well-meaning, can 
hardly have the feel of it in their fingers. Public con- 
trol and criticism are indispensable. But they should 
not be too detailed, or they defeat themselves. It 
would be better that, once fair standards have been 
established, the professional organization should check 
offenses against prices and quality than that it should 
be necessary for the State to do so. The alternative to 
minute external supervision is supervision from within 
by men who become imbued with the public obligations 
of their trade in the very process of learning it. It is, 
in short, professional in industry. 

For "this reason collectivism by itself is too simple a 
solution. Its failure is likely to be that of other ration- 
alist systems. 

"Dann hat er die Theile in seiner Hand, 
Fehlt leider ! nur das geistige Band/' 

If industrial reorganization is to be a living reality, and 
not merely a plan upon paper, its aim must be to secure 
not only that industry is carried on for the service of 
the public, but that it shall be carried on with the 
active co-operation of the organizations of producers. 
But co-operation involves responsibility, and responsi- 
bility involves power. It is idle to expect that men will 
give their best to any system which they do not trust, 
or that they will trust any system in the control of 
which they do not share. Their ability to carry pro- 
fessional obligations depends upon the power which 
they possess to remove the obstacles which prevent those 
obligations from being discharged, and upon their will- 
ingness, when they possess the power, to use it. 



152 THE ACQUISITIVE SOCIETY 

Two causes appear to have hampered the committees 
which were established in connection with coal mines 
during the war to increase the output of coal. One was 
the reluctance of some of them to discharge the invidious 
task of imposing penalties for absenteeism on their 
fellow-workmen. The other was the exclusion of faults 
of management from the control of many committees. 
In some cases all went well till they demanded that, if 
the miners were penalized for absenteeism which was 
due to them, the management should be penalized simi- 
larly when men who desired to work were sent home 
because, as a result of defective organization, there was 
no work for them to do. Their demand was resisted as 
" interference with the management," and the attempt 
to enforce regularity of attendance broke down. Kor, to 
take another example from the same industry, is it to 
be expected that the weight of the miners' organization 
will be thrown on to the side of greater production, if 
it has no power to insist on the removal of the defects 
of equipment and organization, the shortage of trams, 
rails, tubs and timber, the " creaming " of the pits by 
the working of easily got coal to their future detriment, 
their wasteful layout caused by the vagaries of separate 
ownership, by which at present the output is reduced. 

The public cannot have it both ways. If it allows' 
workmen to be treated as " hands " it cannot claim the 
service of their wills and their brains. If it desires 
them to show the zeal of skilled professionals, it must 
secure that they have sufficient power to allow of their 
discharging professional responsibilities. In order that 
workmen may abolish any restrictions on output which 



THE CONDITION OF EFFICIENCY 153 

may be imposed bj them, they must be able to insist on 
the abolition of the restrictions, more mischievous be- 
cause more effective, v^hich, as the Committee on Trusts 
has recently told us, are imposed by organizations of 
employers. In order that the miners' leaders, instead 
of merely bargaining as to wages, hours and working 
conditions, may be able to appeal to their members to 
increase the supply of coal, they must be in a position 
to secure the removal of the causes of low output which 
are due to the deficiencies of the management, and 
which are to-day a far more serious obstacle than any 
reluctance on the part of the miner. If the workmen 
in the building trade are to take combined action to 
accelerate production, they must as a body be consulted 
as to the purpose to which their energy is to be applied, 
and must not be expected to build fashionable houses, 
when what are required are six-roomed cottages to 
house families which are at present living with three 
persons to a room. 

It is deplorable, indeed, that any human beings 
should consent to degrade themselves by producing the 
articles which a considerable number of workmen turn 
out to-day, boots which are partly brown- paper, and 
furniture which is not fit to use. The revenge of out- 
raged humanity is certain, though it is not always 
obvious; and the penalty paid by the consumer for 
tolerating an organization of industry which, in the 
name of efficiency, destroyed the responsibility of the 
workman, is that the service with which he is provided 
is not even efficient. He has always paid it, though be 
has not seen it, in quality. To-day he is beginning to 



154 THE ACQUISITIVE SOCIETY 

realize that he is likely to pay it in quantity as well. 
If the public is to get efficient service, it can get it only 
from human beings, with the initiative and caprices of 
human beings. It will get it, in short, in so far as it 
treats industry as a responsible profession. 

The collective responsibility of the workers for the 
maintenance of the standards of their profession is, 
then, the alternative to the discipline which Capitalism 
exercised in the past, and which is now breaking down. 
It involves a fundamental change in the position both 
of employers and of trade unions. As long as the direc- 
tion of industry is in the hands of property-owners or 
their agents, who are concerned to extract from it the 
maximum profit for themselves, a trade union is neces- 
sarily a defensive organization. Absorbed, on the one 
hand, in the struggle to resist the downward thrust of 
Capitalism upon the workers' standard of life, and de- 
nounced, on the other, if it presumes, to " interfere with 
management," even when management is most obviously 
inefficient, it is an opposition which never becomes a 
government and which has neither the will nor the power 
to assume responsibility for the quality of the service 
offered to the consumer. If the abolition of functionless 
property transferred the control of production to bodies 
representing those who perform constructive work and 
those who consume the goods produced, the relation of 
the worker to the public would no longer be indirect 
but immediate, and associations which are now purely 
defensive would be in a position not merely to criticize 
and oppose but to advise, to initiate and to enforce upon 
their own members the obligations of the craft. 



THE CONDITION OF EFFICIENCY 155 

It is obvious that in such circumstances the service 
offered the consumer, however carefully safeguarded by 
his representation on the authorities controlling each in- 
dustry, would depend primarily upon the success of 
professional organizations in finding a substitute for 
the discipline exercised to-day by the agents of prop- 
erty-owners. It would be necessary for them to main- 
tain by their own action the zeal, efficiency and profes- 
sional pride which, when the barbarous weapons of the 
nineteenth century have been discarded, would be the 
only guarantee of a high level of production. Nor, once 
this new function has been made possible for profes- 
sional organizations, is there any extravagance in ex- 
pecting them to perform it with reasonable competence. 
How far economic motives are balked to-day and could 
be strengthened by a different type of industrial organi- 
zation, to what extent, and under what conditions, it is 
possible to enlist in the services of industry motives 
which are not purely economic, can be ascertained only 
after a study of the psychology of work which has not 
yet been made. Such a study, to be of value, must 
start by abandoning the conventional assumptions, popu- 
larized by economic textbooks and accepted as self-evi- 
dent by practical men, that the motives to effort are 
simple and constant in character, like the pressure of 
steam in a boiler, that they are identical throughout all 
ranges of economic activity, from the stock exchange 
to the shunting of wagons or laying of bricks, and that 
they can be elicited and strengthened only by directly 
economic incentives. In so far as motives in industry 
have been considered hitherto, it has usually been done 



156 THE ACQUISITIVE SOCIETY 

by writers who, like most exponents of scientific man- 
agement, have started by assuming that the categories 
of business psychology could be offered with equal suc- 
cess to all classes of workers and to all types of produc- 
tive work. Those categories appear to be derived from 
a simplified analysis of the mental processes of the com- 
pany promoter, financier or investor, and their validity 
as an interpretation of the motives and habits which 
determine the attitude to his work of the bricklayer, 
the miner, the dock laborer or the engineer, is precisely 
the point in question. 

Clearly there are certain types of industry to which 
they are only partially relevant. It can hardly be as- 
sumed, for example, that the degree of skill and energy 
brought to his work by a surgeon, a scientific investi- 
gator, a teacher, a medical officer of health, an Indian 
civil ser\^ant and a peasant proprietor are capable of 
being expressed precisely and to the same degree in 
terms of the economic advantage which those different 
occupations offer. Obviously those who pursue them 
are influenced to some considerable, though uncertain, 
extent by economic incentives. Obviously, again, the 
precise character of each process or step in the exercise 
of their respective avocations, the performance of an 
operation, the carrying out of a piece of investigation, 
the selection of a particular type of educational method, 
the preparation of a report, the decision of a case or the 
care of live stock, is not immediately dependent upon 
an exact calculation of pecuniary gain or loss. What 
appears to be the case is that in certain walks of life, 
while the occupation is chosen after a consideration of 



THE CONDITION OF EFFICIENCY 157 

its economic advantages, and while economic reasons 
exact the minimum degree of activity needed to avert 
dismissal from it or ^' failure,'' the actual level of 
energy or proficiency displayed depend largely upon 
conditions of a different order. Among them are the 
character of the training received before and after 
entering the occupation, the customary standard of 
effort demanded by the public opinion of one's fellows, 
the desire for the esteem of the small circle in which 
the individual moves and to be recognized as having 
^' made good " and not to have " failed," interest in 
one's work, ranging from devotion to a determination 
to " do justice " to it, the pride of the craftsman, the 
" tradition of the service." 

It would be foolish to suggest that any considerable 
body of men are uninfluenced by economic considera- 
tions. But to represent them as amenable to such in- 
centives only is to give a quite unreal and bookish pic- 
ture of the actual conditions under whicli the work of 
the world is carried on. How large a part such con- 
siderations play varies from one occupation to another, 
according to the character of the work which it does 
and the manner in which it is organized. In what is 
called 'par excellence industry, calculations of pecuniary 
gain and loss are more powerful than in most of the so- 
called professions, though even in industry they are 
more constantly present to the minds of the business 
men who " direct " it, than to those of the managers and 
technicians, most of whom are paid fixed salaries, or to 
the rank and file of wage-workers. In the professions 
of teaching and medicine, in many branches of the pub- 



158 THE ACQUISITIVE SOCIETY 

lie service, the necessary qualities are secured, without 
the intervention of the capitalist employer, partly by 
pecuniary incentives, partly by training and education, 
partly by the acceptance on the part of those entering 
them of the traditional obligations of their profession 
as part of the normal framework of their working lives. 
But this difference is not constant and unalterable. 
It springs from the manner in which different types of 
occupation are organized, on the training which they 
offer, and the morale which they cultivate among their 
members. The psychology of a vocation can in fact be 
changed ; new motives can be elicited, provided steps are 
taken to allow them free expression. It is as feasible 
to turn building into an organized profession, with a 
relatively high code of public honor, as it was to do 
the same for medicine or teaching. 

The truth is that we ought radically to revise the 
presuppositions as to human motives on which current 
presentations of economic theory are ordinarily founded 
and in terms of which the discussion of economic ques- 
tion is usually carried on. The assumption that the 
stimulus of imminent personal want is either the only 
spur, or a sufficient spur, to productive effort is a relic 
of a crude psychology which has little warrant either 
in past history or in present experience. It derives 
what plausibility it possesses from a confusion between 
work in the sense of the lowest quantum of activity 
needed to escape actual starvation, and the work which 
is given, irrespective of the fact that elementary wants 
may already have been satisfied, through the natural dis- 
position of ordinary men to maintain, and of extraordi- 



THE CONDITION OF EFFICIENCY 159 

nary men to improve upon, the level of exertion ac- 
cepted as reasonable by the public opinion of the group 
of which they are members. It is the old difference, 
forgotten by society as often as it is learned, between 
the labor of the free man and that of the slave. Eco- 
nomic fear may secure the minimum effort needed to 
escape economic penalties. What, however, has made 
progress possible in the past, and what, it may be sug- 
gested, matters to the world to-day, is not the bare 
minimum which is required to avoid actual want, but 
the capacity of men to bring to bear upon their tasks a 
degree of energy, which, while it can be stimulated by 
economic incentives, yields results far in excess of any 
which are necessary merely to avoid the extremes of 
hunger or destitution. 

That capacity is a matter of training, tradition and 
habit, at least as much as of pecuniary stimulus, and the 
ability of a professional association representing the 
public opinion of a group of workers to raise it is, 
therefore, considerable. Once industry has been lib- 
erated from its subservience to the interests of the func- 
tionless property-owner, it is in this sphere that trade 
unions may be expected increasingly to find their func- 
tion. Its importance both for the general interests of 
the community and for the special interests of particular 
groups of workers can hardly be exaggerated. Techni- 
cal knowledge and managerial skill are likely to be avail- 
able as readily for a committee appointed by the workers 
in an industry as for a committee appointed, as now, 
by the shareholders. But it is more and more evident 
to-day that the crux of the economic situation is not 



160 THE ACQUISITIVE SOCIETY 

the teclinical deficiencies of industrial organization, but 
the growing inability of those who direct industry to 
command the active good will of the personnel. Their 
co-operation is promised by the conversion of industry 
into a profession serving the public, and promised, as 
far as can be judged, by that alone. 

[N'or is the assumption of the new and often disagree- 
able obligations of internal discipline and public re- 
sponsibility one which trade unionism can afford, once 
the change is accomplished, to shirk, however alien they 
may be to its present traditions. Eor ultimately, if by 
slow degrees, power follows the ability to wield it; 
authority goes with function. The w^orkers cannot have 
it both ways. They must choose whether to assume the 
responsibility for industrial discipline and become free, 
or to repudiate it and continue to be serfs. If, organ- 
ized as professional bodies, they can provide a more 
effective service than that which is now, with increas- 
ing difficulty, extorted by the agents of capital, they 
will have made good their hold upon the future. If 
they cannot, they will remain among the less calculable 
instruments of production which many of them are to- 
day. The instinct of mankind warns it against accept- 
ing at their face value spiritual demands which cannot 
justify themselves by practical achievements. And the 
road along which the organized workers, like any other 
class, must climb to power, starts from the provision of 
a more effective economic service than their masters, as 
their grip upon industry becomes increasingly vacillat- 
ing and uncertain, are able to supply. 



THE POSITION OF THE BRAIN WORKER 

The conversion of industry into a profession will in- 
volve at least as great a change in tlie position of the 
management as in that of the manual workers. ,As 
each industry is organized for the performance of func- 
tion, the employer will cease to be a profit maker and 
become what, in so far as he holds his position by a 
reputable title, he already is, one workman among 
others. In some industries, where the manager is a 
capitalist as well, the alteration may take place through 
such a limitation of his interest as a capitalist as it has 
been proposed by employers and workers to introduce 
into the building industry. In others, where the whole 
work of administration rests on the shoulders of salaried 
managers, it has already in part been carried out. The 
economic conditions of this change have, indeed, been 
prepared by the separation of ownership from manage- 
ment, and by the growth of an intellectual proletariat 
to whom the scientific and managerial work of industry 
is increasingly intrusted. The concentration of busi- 
nesses, the elaboration of organization, and the develop- 
ments springing from the application of science to in- 
dustry have resulted in the multiplication of a body of 
industrial brain workers who make the old classi- 
fications into " employers and workmen," which is 
still current in common speech, an absurdly mislead- 

161 



162 THE ACQUISITIVE SOCIETY 

ing description of the industrial system as it exists 
to-day. 

To complete the transformation all that is needed is 
that this new class of officials, who fifty years ago were 
almost unknown, should recognize that they, like the 
manual workers, are the victims of the domination of 
property, and that both professional pride and economic 
interest require that they should throw in their lot with 
the rest of those who are engaged in constructive work. 
Their position to-day is often, indeed, very far from 
being a happy one. Many of them, like some mine 
managers, are miserably paid. Their tenure of their 
posts is sometimes highly insecure. Their opportuni- 
ties for promotion may be few, and distributed with a 
singular capriciousness. They see the prizes of indus- 
try awarded by favoritism, or by the nepotism which 
results in the head of a business unloading upon it a 
family of sons whom it would be economical to pay to 
keep out of it, and which, indignantly denounced on the 
rare occasions on which it occurs in the public service, is 
so much the rule in private industry that no one even 
questions its propriety. During the war they have 
found that, while the organized workers have secured 
advances, their own salaries have often remained almost 
stationary, because they have been too genteel to take 
part in trade unionism, and that to-day they are some- 
times paid less than the men for whose work they are 
supposed to be responsible. Regarded by the workmen 
as the hangers-on of the masters, and by their employers 
as one section among the rest of the " hands," they have 
the odium of capitalism without its power or its profits. 



POSITION OF THE BRAIN WORKER 163 

Erom the conversion of industry into a profession 
those who at present do its intellectual work have as 
much to gain as the manual workers. Eor the principle 
of function, for which we have pleaded as the basis of 
industrial organization, supplies the only intelligible 
standard by which the powers and duties of the different 
groups engaged in industry can be determined. At the 
present time no such standard exists. The social order 
of the pre-industrial era, of which faint traces have sur- 
vived in the forms of academic organization, was 
marked by a careful grading of the successive stages in 
the progress from apprentice to master, each of which 
was distinguished by clearly defined rights and duties, 
varying from grade to grade and together forming a 
hierarchy of functions. The industrial system which 
developed in the course of the nineteenth century did 
not admit any principle of organization other than the 
convenience of the individual, who by enterprise, skill, 
good fortune, unscrupulous energy or mere nepotism, 
happened at any moment to be in a position to wield 
economic authority. His powers were what he could 
exercise; his rights were what at any time he could 
assert. The Lancashire mill-owner of the fifties was, 
like the Cyclops, a law unto himself. Hence, since sub- 
ordination and discipline are indispensable in any 
complex undertaking, the subordination which emerged 
in industry was that of servant to master, and the dis- 
cipline such as economic strength could impose upon 
economic weakness. 

The alternative to the allocation of power by the 
struggle of individuals for self-aggrandizement is its 



164 THE ACQUISITIVE SOCIETY 

allocation according to function, that each group in the 
complex process of production should wield so much 
authority as, and no more authority than, is needed to 
enable it to perform the special duties for which it is 
responsible. An organization of industry based on this 
principle does not imply the merging of specialized eco- 
nomic functions in an undifferentiated industrial democ- 
racy, or the obliteration of the brain workers beneath the 
sheer mass of artisans and laborers. But it is incom- 
patible with the unlimited exercise of economic power 
by any class or individual. It would have as its funda- 
mental rule that the only powers which a man can exer- 
cise are those conferred upon him in virtue of his office. 
There would be subordination. But it would be pro- 
foundly different from that which exists to-day. For 
it would not be the subordinntion of one man to an- 
other, but of all men to the purpose for which industry 
is carried on. There would be authority. But it would 
not be the authority of the individual who imposes 
rules in virtue of his economic power for the attainment 
of his economic advantage. It would be the authority 
springing from the necessity of combining different; 
duties to attain a common end. There would be dis- ^ 
cipline. But it would be the discipline involved in 
pursuing that end, not the discipline enforced upon one 
man for the convenience or profit of another. Under 
such an organization of industry the brain worker 
might expect, as never before, to come to his own. He 
would be estimated and promoted by his capacity, not 
by his means. He would be less likely than at present 
to find doors closed to him because of poverty. His 



POSITION OF THE BRAIN WORKER 165 

judges would be his colleagues, not an owner of prop- 
erty intent on dividends. He would not suffer from the 
perversion of values which rates the talent and energy 
by which wealth is created lower than the possession of 
property, which is at best their pensioner and at worst 
the spend-thrift of what intelligence has produced. In 
a society organized for the encouragement of creative 
activity those who are esteemed most highly will be 
those who create, as in a world organized for enjoyment 
they are those who own. 

Such considerations are too general and abstract to 
carry conviction. Greater concreteness may be given 
them by comparing the present position of mine-man- 
agers with that which they would occupy were effect 
given to Mr. Justice Sankey's scheme for the nationali- 
zation of the Coal Industry. A body of technicians who 
are weighing the probable effects of such a reorganiza- 
tion will naturally consider them in relation both to 
their own professional prospects and to the efficiency of 
the service of which they are the working heads. They 
will properly take into account questions of salaries, 
pensions, security of status and promotion. At the same 
time they will wish to be satisfied as to points which, 
though not less important, are less easily defined. 
Under which system, private or public ownership, will 
they have most personal discretion or authority over the 
conduct of matters within their professional compe- 
tence ? Under which will they have the best guarantees 
that their special knowledge will carry due weight, and 
that, when handling matters of art, they will not be 
overridden or obstructed by amateurs ? 



166 THE ACQUISITIVE SOCIETY 

As far as the specific case of the Coal Industry is con- 
cerned the question of security and salaries need hardly 
he discussed. The greatest admirer of the present sys- 
tem would not argue that security of status is among 
the advantages which it offers to its employees. It is 
notorious that in some districts, at least, managers are 
liable to be dismissed, however professionally competent 
they may be, if they express in public views which are 
not approved by the directors of their company. In- 
deed, the criticism which is normally made on the 
public services, and made not wholly without reason, is 
that the security which they offer is excessive. On the 
question of salaries rather more than one-half of the 
colliery companies of Great Britain themselves supplied 
figures to the Coal Industry Commission.^ If their 
returns may be trusted, it would appear that mine-man- 
agers are paid, as a class, salaries the parsimony of 
which is the more surprising in view of the emphasis 
laid, and quite properly laid, by the mine-owners on 
the managers' responsibilities. The service of the State 
does not normally offer, and ought not to offer, financial 
prizes comparable with those of private industry. But 
it is improbable, had the mines been its property during 

1 The Coal Mines Departmenet supplied the following figures 
to the Coal Industry Commission (Vol. Ill, App. 66). They 
relate to 57 per cent, of the colleries of the United Kingdom. 

Salary, including bonus and Number of Managers 

value of house and coal 1913 1919 

£100 or less 4 2 

f 101 to £200 134 3 

£201 to £300 280 29 

£301 to £400 161 251 

£401 to £500 321 213 

£501 to £600 57 146 

£601 and over 60 152 



POSITION OF THE BRAIN WORKEE 167 

the last ten years, that more than one-half the managers 
would have been in receipt of salaries of under £301 
per year, and of less than £500 in 1919, by which time 
prices had more than doubled, and the aggregate profits 
of the mine-owners (of which the greater part was, how- 
ever, taken by the State in taxation) had amounted in 
^LYQ years to £160,000,000. It would be misleading to 
suggest that the salaries paid to mine-managers are 
typical of private industry, nor need it be denied that 
the probable effect of turning an industry into a public 
service would be to reduce the size of the largest prizes 
at present offered. What is to be expected is that the 
lower and medium salaries would be raised, and the 
largest somewhat diminished. It is hardly to be denied, 
at any rate, that the majority of brain workers in in- 
dustry have nothing to fear on financial grounds from 
such a change as is proposed by Mr. Justice Sankey. 
Under the normal organization of industry, profits, it 
cannot be too often insisted, do not go to them but to 
shareholders. There does not appear to be any reason 
to suppose that the salaries of managers in the mines 
making more than 5/- profit a ton were any larger than 
those making under 3/-. 

The financial aspect of the change is not, however, 
the only point which a group of managers or technicians 
have to consider. They have also to weigh its effect on 
their professional status. Will they have as much free- 
dom, initiative and authority in the service of the com- 
munity as under private ownership? How that ques- 
tion is answered depends upon the form given to the 
administrative system through which a public service is 



168 THE ACQUISITIVE SOCIETY 

conducted. It is possible to conceive an arrangement 
under which the life of a mine-manager would be made 
a burden to him by perpetual recalcitrance on the part 
of the men at the pit for which he is responsible. It is 
possible to conceive one under which he would be ham- 
pered to the point of paralysis by irritating interference 
from a bureaucracy at headquarters. In the past some 
managers of " co-operative workshops " suffered, it 
would seem, from the former : many officers of Employ- 
ment Exchanges are the victims, unless common rumor 
is misleading, of the latter. It is quite legitimate, in- 
deed it is indispensable, that these dangers should be 
emphasized. The problem of reorganizing industry is, 
as has been said above, a problem of constitution mak- 
ing. It is likely to be handled successfully only if the 
defects to which different types of constitutional ma- 
chinery are likely to be liable are pointed out in advance. 
Once, however, these dangers are realized, to devise 
precautions against them appears to be a comparatively 
simple matter. If .Mr. Justice Sankey's proposals be 
taken as a concrete example of the position which would 
be occupied by the managers in a nationalized industry, 
it will be seen that they do not involve either of the two 
dangers which are pointed out above. The manager 
will, it is true, work with a Local Mining Council or pit 
committee, which is to " meet fortnightly, or oftener if 
need be, to advise the manager on all questions concern- 
ing the direction and safety of the mine,'' and " if the 
manager refuses to take the advice of the Local Mining 
Council on any question concerning the safety and 
health of the mine, such question shall be referred to 



POSITION OP THE BRAIN WORKER 169 

the District Mining Council." It is true also that, once 
such a Local Mining Council is formally established, 
the manager will find it necessary to win its confidence, 
to lead by persuasion, not by mere driving, to establish, 
in short, the same relationships of comradeship and good 
will as ought to exist between the colleagues in any 
common undertaking. But in all this there is nothing 
to undermine his authority, unless " authority " be 
understood to mean an arbitrary power which no man 
is fit to exercise, and which few men, in their sober 
moments, would claim. The manager will be appointed 
by, and responsible to, not the men whose work he super- 
vises, but the District Mining Council, which controls 
all the pits in a district, and on that council he will be 
represented. Nor will he be at the mercy of a distant 
" clerkocracy," overwhelming him with circulars and 
overriding his expert knowledge with impracticable 
mandates devised in London. The very kernel of the 
schemes advanced both by Justice Sankey and by the 
Miners' Federation is decentralized administration 
within the framework of a national system. There is no 
question of '' managing the industry from Whitehall." 
The characteristics of different coal-fields vary so widely 
that reliance on local knowledge and experience are 
essential, and it is to local knowledge and experience 
that it is proposed to intrust the administration of the 
industry. The constitution which is recommended is, in 
short, not " Unitary " but " Federal." There will be a 
division of functions and power between central authori- 
ties and district authorities. The former will lay down 
general rules as to those matters which must necessarily 



170 THE ACQUISITIVE SOCIETY 

be dealt with on a national basis. The latter will ad- 
minister the industry within their own districts, and, as 
long as thej comply with those rules and provide their 
quota of coal, will possess local autonomy and will 
follow the method of working the pits which they think 
best suited to local conditions. 

Thus interpreted, public ownership does not appear to 
confront the brain worker with the danger of unintelli- 
gent interference with his special technique, of which he 
is, quite naturally, apprehensive. It offers him, indeed, 
far larger opportunities of professional development than 
are open to all but a favored few to-day, when the con- 
siderations of productive efficiency, which it is his spe- 
cial metier to promote, are liable to be overridden by 
short-sighted financial interests operating through the 
pressure of a Board of Directors who desire to show an 
immediate profit to their shareholders, and who, to 
obtain it, will " cream " the pit, or work it in a way 
other than considerations of technical efficiency would 
dictate. And the interest of the community in secur- 
ing that the manager's professional skill is liberated for 
the service of the public, is as great as his own. For 
the economic developments of the last thirty years have 
made the managerial and technical 'personnel of indus- 
try the repositories of public responsibilities of quite in- 
calculable importance, which, with the best will in the 
world, they can hardly at present discharge. The most 
salient characteristic of modern industrial organization 
is that production is carried on under the general di- 
rection of business men, who do not themselves neces- 
sarily know anything of productive processes. " Busi- 



POSITION OF THE BRAIN WORKER 171 

ness '' and " industry " tend to an increasing extent to 
form two compartments, which, though united within 
the same economic system, employ different types of 
personnel, evoke different qualities and recognize differ- 
ent standards of efficiency and workmanship. The tech- 
nical and managerial staff of industry is, of course, 
as amenable as other men to economic incentives. But 
their special work is production, not finance; and, pro- 
vided they are not smarting under a sense of economic 
injustice, they want, like most workmen, to '^ see the job 
done properly.'^ The business men who ultimately con- 
trol industry are concerned with the promotion and 
capitalization of companies, with competitive selling 
and the advertisement of wares, the control of markets, 
the securing of special advantages, and the arrangement 
of pools, combines and monopolies. They are pre- 
occupied, in fact, with financial results, and are inter- 
ested in the actual making of goods only in so far as 
financial results accrue from it. 

The change in organization which has, to a consider- 
able degree, specialized the spheres of business and man- 
agement is comparable in its importance to that which 
separated business and labor a century and a half 
ago. It is specially momentous for the consumer. 
As long as the functions of manager, technician and 
capitalist were combined, as in the classical era of the 
factory system, in the single person of '^ the employer," 
it was not unreasonable to assume that profits and pro- 
ductive efficiency ran similarly together. In such cir- 
cumstances the ingenuity with which economists proved 



172 THE ACQUISITIVE SOCIETY 

that, in obedience to " the law of substitution,'' be would 
choose the most economical process, machine, or type of 
organization, wore a certain plausibility. True, the em- 
ployer might, even so, adulterate his goods or exploit the 
labor of a helpless class of workers. But as long as the 
person directing industry was himself primarily a man- 
ager, he could hardly have the training, ability or time, 
even if he had the inclination, to concentrate special at- 
tention on financial gains unconnected with, or opposed 
to, progress in the arts of production, and there was 
some justification for the conventional picture which 
represented " the manufacturer " as the guardian of the 
interests of the consumer. With the drawing apart of 
the financial and technical departments of industry — 
with the separation of " business '' from " production " 
• — the link which bound profits to productive efficiency 
is tending to be snapped. There are more ways than 
formerly of securing the former without achieving the 
latter; and when it is pleaded that the interests of the 
captain of industry stimulate the adoption of the most 
" economical " methods and thus secure industrial prog- 
ress, it is necessary to ask " economical for whom " ? 
Though the organization of industry which is most ef- 
ficient, in the sense of offering the consumer the best 
service at the lowest real cost, may be that which is most 
profitable to the firm, it is also true that profits are 
constantly made in ways which have nothing to do with 
efficient production, and which sometimes, indeed, im- 
pede it. 

The manner in which " business "may find that the 
methods which pay itself best are those which a truly 



POSITION OF THE BRAIN WORKER 173 

scientific '' management '' would condemn may be illus- 
trated by three examples. In tbe first place, the whole 
mass of profits which are obtained by the adroit capi- 
talization of a new business, or the reconstruction of one 
which already exists, have hardly any connection with 
production at all. When, for instance, a Lancashire 
cotton mill capitalized at £100,000 is bought by a 
London syndicate which re-floats it with a capital of 
£500,000 — not at all an extravagant case — what exactly 
has happened? In many cases the equipment of the 
mill for production remains, after the process, what it 
was before it. It is, however, valued at a different 
figure, because it is anticipated that the product of the 
mill will sell at a price which will pay a reasonable 
profit not only upon the lower, but upon the higher, 
capitalization. If the apparent state of the market and 
prospects of the industry are such that the public can be 
induced to believe this, the promoters of the reconstruc- 
tion find it worth while to recapitalize the miU on the 
new basis. They make their profit not as manufac- 
turers, but as financiers. They do not in any way add 
to the productive efficiency of the firm, but they acquire 
shares which will entitle them to an increased return. 
ISTormally, if the market is favorable, they part with the 
greater number of them as soon as they are acquired. 
But, whether they do so or not, what has occurred is a 
process by which the business element in industry ob- 
tains the right to a larger share of the product, without 
in any way increasing the efficiency of the service which 
is offered to the consumer. 

Other examples of the manner in which the control of 



m THE ACQUISITIVE SOCIETY 

production bv ** business " cuts across the line of eco- 
nomic progress are the wastes of competitive industry 
and the profits of nuonopoly. It is well known that the 
price paid by the consumer includes marketing costs, 
which to a varying, but to a large, extent are expenses 
not of supplying the goods, but of supplying them under 
conditions involving the expenses of advertisement and 
competitive distribution. For the individual firm such 
expenses, which enable it to absorb part of a rival's 
trade, may be an economy : to the consumer of milk or 
coal — to take two flagrant instances — they are pure 
loss. Xor, as is sometimes assumed, are such wastes 
confined to distribution. Technical reasons are stated 
by railway managers to make desirable a unification of 
railway administration and by mining experts of mines. 
But, up to the war, business considerations maintained 
the expensive system under which each railway company 
was operated as a separate system, and still prevent col- 
lieries, even collieries in the same district, from being 
administered as parts of a single organization. Pits are 
drowned out by water, because companies cannot agree 
to apportion between them the costs of a common drain- 
age system; materials are bought, and products sold, 
separately, because collieries will not combine; small 
coal is left in to the amount of millions of tons because 
the most economical and technically efficient working of 
the seams is not necessarily that which yields the largest 
profit to the business men who control production. In 
this instance the wide differences in economic strength 
which exist between different mines discourage the uni- 
fication which is economically desirable; naturally the 



POSITIOX OF THE BEAIX WORKER 175 

directors of a company which owns '' a good thing" do 
not desire to merge interests with a company working 
coal that is poor in quality or expensive to mine. When, 
as increasingly happens in other industries, competi- 
tive wastes, or some of them, are eliminated by com- 
bination, there is a genuine advance in technical ef- 
ficiency, which must be set to the credit of business 
motives. In that event, however, the divergence be- 
tween business interests and those of the consumers is 
merely pushed one stage further forward; it arises, of 
course, over the question of prices. If any one is dis- 
posed to think that this picture of the economic waste 
which accompanies the domination of production by 
business interests is overdrawn, he may be invited to 
consider the criticisms upon the system passed by the 
"' efiSciency engineers," who are increasingly being 
called upon to advise as to industrial organization and 
equipment. " The higher officers of the corporation,"' 
writes Mr. H. L. Gantt of a Public Utility Company 
established in America during the war, ^' have all with- 
out exception been men of the ' business ' type of mind, 
who have made their success through financiering, buy- 
ing, selling, etc. . . . As a matter of fact it is well 
known that our industrial system has not measured up 
as we had expected. . . . The reason for its falling 
short is undoubtedly that the men directing it h-ad been 
trained in a business system operated for profits, and 
did not understand one operated solely for production. 
This is no criticism of the men as individuals; they 
simply did not know the job, and, what is worse, they 
did not know that they did not know it." 



176 THE ACQUISITIVE SOCIETY 

In so far, then, as " Business " and ^^ Management " 
are separated, the latter being employed under the di- 
rection of the former, it cannot be assumed that the 
direction of industry is in the hands of persons whose 
primary concern is productive efficiency. That a con- 
siderable degree of efficiency will result incidentally 
from the pursuit of business profits is not, of course, 
denied. "What seems to be true, however, is that the 
main interest of those directing an industry which has 
reached this stage of development is given to financial 
strategy and the control of markets, because the gains 
] which these activities offer are normally so much larger 
than those accruing from the mere improvement of the 
processes of production. It is evident, however, that it 
is precisely that improvement which is the main inter- 
est of the consumer. He may tolerate large profits as 
long as they are thought to be the symbol of efficient 
production. But what he is concerned with is the supply 
of goods, not the value of shares, and when profits ap- 
pear to be made, not by efficient production, but by 
skilful financiering or shrewd commercial tactics, they 
no longer appear meritorious. If, in disgust at what 
he has learned to call " profiteering," the consumer seeks 
an alternative to a system under which product is con- 
trolled by " Business," he can hardly find it except by 
making an ally of the managerial and technical per- 
sonnel of industry. They organize the service which he 
requires ; they are relatively little implicated, either by 
material interest or by psychological bias, in the finan- 
cial methods which he distrusts ; they often find the con- 
trol of their professions by business men who are pri- 



POSITION OF THE BKAIN WOEKER 177 

marily financiers irritating in the obstruction which it 
offers to technical efficiency, as well as sharp and close- 
fisted in the treatment of salaries. Both on public and 
professional grounds they belong to a group which ought 
to take the initiative in^romqUng a^^artnershijD between, 
the producers^and the public. They can offer the com- 
munity the scientific knowledge and specialized ability 
which is the most important condition of progress in the 
arts of production. It can offer them a more secure and 
dignified status, larger opportunities for the exercise of 
their special talents, and the consciousness that they are 
giving the best of their work and their lives, not to 
enriching a handful of uninspiring, if innocuous, share- 
holders, but to the service of the great body of their 
fellow-countrymen. If the last advantage be dismissed 
as a phrase — if medical officers of health, directors of 
education, directors of the co-operative wholesale be as- 
sumed to be quite uninfluenced by any consciousness of 
social service — the first two, at any rate, remain. And 
they are considerable. 

It is this gradual disengagement of managerial tech- 
nique from financial interests which would appear the 
probable line along which " the employer " of the future 
will develop. The substitution throughout industry of 
fixed salaries for fluctuating profits would, in itself, de- 
prive his position of half the humiliating atmosphere of 
predatory enterprise which embarrasses to-day any man 
of honor who finds himself, when he has been paid for 
his services, in possession of a surplus for which there 
is no assignable reason. IsTor, once large incomes from 
profits have been extinguished^ need his salary be large, 



178 THE ACQUISITIVE SOCIETY 

as incomes are reckoned to-day. It is said that among 
the barbarians, where wealth is still measured by cattle, 
great chiefs are described as hundred-cow men. The 
manager of a great enterprise who is paid $400,000 a 
year, might similarly be described as a hundred-family 
man, since he receives the income of a hundred families. 
It is true that special talent is worth any price, and 
that a payment of $400,000 a year to the head of a 
business with a turnover of millions is economically a 
bagatelle. But economic considerations are not the 
only considerations. There is also ^^ the point of 
honor." And the truth is that these hundred-family 
salaries are ungentlemanly. 

When really important issues are at stake every one 
realizes that no decent man can stand out for his price. 
A general does not haggle with his government for the 
precise pecuniary equivalent of his contribution to vic- 
tory. A sentry who gives the alarm to a sleeping bat- 
talion does not spend next day collecting the capital 
value of the lives he has saved ; he is paid 1/- a day and 
is lucky if he gets it. The commander of a ship does 
not cram himself and his belongings into the boats and 
leave the crew to scramble out of the wreck as best they 
can; by the tradition of the service he is the last man 
to leave. There is no reason why the public should 
insult manufacturers and men of business by treating 
them as though they were more thick-skinned than gen- 
erals and more extravagant than privates. To say that 
they are worth a good deal more than even the exorbi- 
tant salaries which a few of them get is often true. 
But it is beside the point. No one has any business to 



POSITION OF THE BRAIN WORKER 179 

expect to be paid '' what he is worth," for what he 1 
is worth is a matter between his own soul and God. ! 
Whal^ejias a right to demand^, and wha^J^concernsJiis_ 
fellow-men to see/!HatJie gets, is eiiough to enable him 
to perform his work. When industry is organized on a 
basis of function, that, and no more than that, is what 
he will be paid. To do the managers of industry jus- 
tice, this whining for more money is a vice to which 
they (as distinct from their shareholders) are not par- 
ticularly prone. There is no reason why they should 
be. If a man has important work, and enough leisure 
and income to enable him to do it properly, he is in 
possession of as much happiness as is good for any of 
the children of Adam. 



XI 

POEEO rXUM XECESSAEirM 

So the organization of society on the basis of function, 
instead of on that of rights, implies three things. It 
means, first, that proprietary rights shaU be maintained 
when they are accompanied by the performance of serv- 
ice and abolished when they are not. It means, second, 
that the producers shall stand in a direct relation to the 
community for whom production is carried on, so that 
their responsibility to it may be obvious and unmistak- 
able, not lost, as at present, through their immediate 
subordination to shareholders whose interest is not serv- 
ice but gain. It means, in the third place, that the obli- 
gation for the maintenance of the service shall rest upon 
the professional organization of those who perform it, 
and that, subject to the supervision and criticism of 
the consumer, those organizations shall exercise so 
much voice in the government of industry as may be 
needed to secure that the obligation is discharged. It 
is obvious, indeed, that no change of system or ma- 
chinery can avert those causes of social malaise which 
consist in the egotism, greed, or quarrelsomeness of 
human nature. What it can do is to create an environ- 
ment in which those are not the qualities which are en- 
couraged. It cannot secure that men live up to their 
principles. What it can do is to establish their social 
order upon principles to which, if they please, they can 

180 



POERO UXUM XECESSAEIUM 181 

live up and not live down. It cannot control their 
actions. It can offer them an end on which to fix their 
minds. And, as their minds are, so, in the long nm 
and with exceptions, their practical activity wiU be. 

The first condition of the right organization of indus- 
try is, then, the intellectual conversion which, in their 
distrust of principles, Englishmen are disposed to place 
last or to omit altogether. It is that emphasis should 
be transferred from the opportunities which it offers in- 
dividuals to the social functions which it performs ; that 
they should be clear as to its end and should judge it 
by reference to that end, not by incidental consequences 
which are foreign to it. however brilliant or alluring 
those consequences may be. WhaJ_giye3 if meaning to 
any activity which is not purely autoroatic is,its_2ur^ 
pose. It i3~because t^e^gurpose of industry^ which i^ 
the conquest of nature for the service ofjnan^Js_neithei|__ 
adequately expressed^ in its organization nor present 
to the minds of those engaged in it, because it is not 
regarded as a function but as an_appoitanitY for_per^ 
sonal gain or advancement or display, that the economic 
life of modem societies is in a perpetual state of morbid 
irritation. If the conditions which produce that un- 
natural tension are to be removed, it can only be 
effected by the growth of a habit of mind which w411 
approach questions of economic organization from the 
standpoint of the purpose which it exists to serve, and 
which will apply to it something of the spirit expressed 
by Bacon when he said that the work of man ought to 
be carried on *'•' for the glory of God and the relief of 
men's estate." 



182 THE ACQUISITIVE SOCIETY 

Viewed from that angle issues which are insoluble 
when treated on the basis of rights may be found more 
susceptible of reasonable treatment. For_a^_2ur£Ose^^is^ 
in the first place a principle of limitation. It J^ter- 
min.es_the-enl^r which, and therefore the limits within. 
whichy-,an_activity is to be carried on. It divided what 
is worth doing from what is not, and settles the scale 
upon which what is worth doing ought to be done. It 
is in the second place, a principle of unity, because it 
supplies a common end to whTcli efforts caiLlie direct^, 
and " suBmits'lnterests, which would otherwise conflict, 
to the judgment of an over-ruling object. It is, in the 
third place, a principle of apportionment or distribu- 
tion. It assigns to the different parties of groups en- 
gaged in a common undertaking the place which they 
are to occupy in carrying it out. Thus it establishes 
order, not upon chance or power, but upon a principle, 
and bases remuneration not upon what men can with 
good fortune snatch for themselves nor upon what, if 
unlucky, they can be induced to accept, but upon what 
is appropriate to their function, no more and no less, 
so that those who perform no function receive no pay- 
ment, and those who contribute to the common end re- 
ceive honorable payment for honorable service. 

Frate, la nostra volonta quieta 

Virtu di carita, che fa volerne 

Sol quel ch'avemo, e d'altro non ci asseta. 

Si disiassimo esse piu superne, 

Foran discordi li nostri disiri 

Dal voler di colui che qui ne cerne. 



PORRO UNUM NECESSARITJM 183 

Anzi e formale ad esto beato esse 
Tenersi dentro alia divina vogli, 
Per ch'una fansi nostre vogli e stesse. 

Chiaro mi fu allor com' ogni dove 

In Cielo e paradiso, e si la grazia 

Del sommo ben d'un modo non vi piove. 

The famous lines in which Piccarda explains to Dante 
the order of Paradise are a description of a complex 
and multiform society which is united by overmaster- 
ing devotion to a common end. By that end all stations 
are assigned and all activities are valued. The parts 
derive their quality from their place in the system, and 
are so permeated by the unity which they express that 
they themselves are glad to be forgotten, as the ribs of 
an arch carry the eye from the floor from which they 
spring to the vault in which meet and interlace. 

Such a combination of unity and diversity is possible 
only to a society which subordinates its activities to 
the principle of purpose. For what that principle offers 
is not merely a standard for determining the relations 
of different classes and groups of producers, but a scale 
of moral values. Above all, it assigns to economic ac- \ 
tivity itself its proper place as the servant, not the 
master, of society. The burden of our civilization is 
not merely, as many suppose, that the product of in- 
dustry is ill-distributed, or its conduct tyrannical, or 
its operation interrupted by embittered disagreements. 
It is that industry itself has come to hold a position of 
exclusive predominance among human interests, which 
no single interest, and least of all the provision of the 



184 THE ACQUISITIVE SOCIETY 

material means of existence, is fit to occupy. Like a 

I hypochondriac who is so absorbed in the processes of 

/ his own digestion that he goes to his grave before he has 

A begun to live, industrialized communities neglect the 

l^ very objects for which it is worth while to acquire riches 

in their feverish preoccupation with the means by which 

riches can be acquired. 

That obsession by economic issues is as local and 
transitory as it is repulsive and disturbing. To future 
generations it will appear as pitiable as the obsession 
of the seventeenth century by religious quarrels appears 
to-day; indeed, it is less rational, since the object with 
which it is concerned is less important. And it is a 
poison which inflames every wound and turns each 
trivial scratch into a malignant ulcer. Society will not 
solve the particular problems of industry which afflict 
it, until that poison is expelled, and it has learned to 
see industry itself in the right perspective. If it is to 
do that, it must rearrange its scale of values. It m ust 
regard economic interests^as one element in life^ not ^s^ 
*fhe~wHoTe of fife. It must persuade its members to ) 
renounce the opportunity of gains which accrue without 
any corresponding service, because the struggle for them 
keeps the whole community in a fever. It must so 
organize industry that the instrumental character of 
economic activity is emphasized by its subordination to 
the social purpose for which it is carried on. 



INDEX 



Abolition of private ownership, 

147 
Absenteeism, 152 
Absolute rights, 50-51 
Absolutism in industry, 144 
Acquisitive societies, 29-32 
Administration, 115-116 
Allocation of power, 163-164 
American Constitution, 18-19, 

52 
Annuities, 74 
Arbitration, compulsory, 101 

' Bacon, quoted, 58, 181 
Bentham, 16, 52, 55 
Brain workers, position of the, 

161-171 
British Coal Industry, reorgan- 
ization of, 166-171 
Building Guilds, 103 
Building Trade Report, 106-110 
Bureaucracy, 116, 149 

Capitalism, and production, 
173-176; downward thrust of, 
154; in America, 101; losing 
control, 141-142, 148 

Cecil, Lord Hugh, 23, 58 

Cecil, Robert, 69 

Cecil, William, 59 

Church and State, 10-13 

Coal Industry Commission, 71, 
126, 137, 143; report of, 166- 
167 

Coal Mines Committees, 152 

Combinations, 125, 130 

Committee on Trusts, 153 

Competition, 27 

Compulsory arbitration, 101 

Confiscations, 103 

Conservatism, the New, 28 

Consumer, exploitation of the, 
133-134 



Co-operative Movement and 
cost of coal, 125 

Dante, quoted, 182-183 
Death Duties, 22 
Democratic control, 116 
Dickenson, Sir Arthur Lowes, 

71 
Directorate control, 129 
Duckham, Sir Arthur, 119 
Duke of Wellington, quoted, 

123 

Economic confusion, cause of, 

131-132 
Economic discontent, increase 

of, 5 
Economic egotism, 27, 
Economic expansion, 9 
Efficiency, the condition of, 139- 

160; through Esprit de 

Corps, 149-150 
Employer, waning power of the, 

140 
England, and natural right, 15- 

16; and France contrasted, 

16-17; Industrialism in, 44- 

47; Liberal Movement in, 18; 

over-crowding of population 

in, 37 ; proprietary rights in, 

64 et seq. 
English landlordism, 22-23 
Englishmen, characteristics of, 

1-3; vanity of, 129 
English Revolution of 1688, 52 
Esch-Cummins Act, 118 
Expediency, rule of, 16 

Feudalism, 18 
Fixed salaries, 177-178 
Forced labor, 102 
France, social and industrial 
conditions in, 16-17; Feudal- 



185 



186 



INDEX 



ism in, 18; Revolution in, 
15, 65, 69 
French Revolution, 15, 65, 69 
Function, definition of, 8; as 
a basis for remuneration, 41- 
42; as a basis of social re- 
organization, 180; Function 
and Freedom, 7 
Functional Society, 29, 84-90 
Functionless property-owners, 
79, 86; abolishment of, 87- 
88; an expensive luxury, 87 

Gainford, Lord, quoted, 26, 111 

Gantt, H. L., 175 

Government control in war 

time, 25-26 
Ground-rents 89-90, 91 

Hobson, Mr., 63 
"Hundred-Family Man," 178 

Imperial Tobacco Company, 116 

Incomes, 41 

Income Tax, 22 

Income without service, 68 

Individualism, 48-49 

Individual rights, 9 

Individual rights vs. social 
functions, 27 

Industrial problems, 7 

Industrial reorganization, 151, 
155 

Industrial revolution, 9 

Industrial societies, 9 

Industrial warfare, cause of, 
and remedy for, 40-42 

Industrialism, 18; a poison, 
184; compared to Militarism, 
44-46 ; exaggerated estimate 
of its importance, 45-46; 
failure of present system, 
139-141; nemesis of, 33-51; 
spread of, 30; tendency of, 
31-32 

Industry, and a profession, 94, 
97; as a profession, 91 et 
seq., 125-126; deficiencies of, 
147; definition of, 6; how 
private control of may be 
terminated, 103-104; and the 



advantages of such a change, 
106; Building Trades' Plan 
for, 108, 111; motives in, 155- 
159; nationalization of, 104, 
114-118; present organiza- 
tion of intolerable, 129; pur- 
pose of, 8, 46, 181; right or- 
ganization of, 6-7 ; the means 
not the end, 46-47 

Inheritance taxes, 90 

Insurance, 74 

Joint control, 111-112 
Joint-stock companies, 66 
Joint-stock organizations, 97 

Labor, absolute rights of, 28; 

and capital, 98-100, 108; 

compulsory, 100; control of 

breaking down, 139 et seq.; 

degradation of, 35; forced, 

102 
League of Nations, 101 
Liberal Movement, 18 
Locke, 14, 52, 55 

Management divorced from 

ownership, 112-113 
I\Iann, Sir John, 126 
Militarism, 44-45 
Mill, quoted, 89 
Mine managers, position of, 

162, 166-168 
Mining royalties, 23-24, 88 

Nationalism, 48-49 
Nationalization, 114, 117; of 

the Coal Industry, 115, 165, 

168-169 
Natural right in France, 15; 

in England, 15-16; doctrine 

of, 21 

OflScials, position under the 
present economic system, 162 

Old industrial order a failure, 
139; its efl'ect on the con- 
sumer, 144 

Organization, for public service 
instead of private gains, 127 

Over-centralization, 121 



INDEX 



187 



Ownership, a new system of, 
112-114 

Pensioners, 34 

Poverty a symptom of social 
disorder, 5 

Private enterprise and public 
ownership, 118-120 

Private ownership, 120; aboli- 
tion of, 147; of industrial 
capital, 105-106 

Private rights and public wel- 
fare, 14-15 

Privileges, 24 

Producer, obligation of the, 
127-128; responsibility of, 
128 

Production, increased, 5 ; large 
scale and small scale, 87; 
misdirection of, 37-39; why 
not increased, 136 

Productivity, 4, 46 

Professional Spirit, the, 149- 
150 

Profits, and production, 173- 
176; division of, 133 

Proletariat, 19, 65 

Property, absolute rights of, 
52, 80; and creative work, 
52 et seq.; classification of, 
63, 64; complexity of, 75; 
functionless, 76-77, 81; in 
land, 56-60; in rights and 
royalties, 62 ; minority owner- 
ship of, 79; most ambiguous 
of categories, 53-54; passive 
ownership of, 62; private, 70- 
72; protection of, 78-79; 
rights, 50-51 ; security in, 72- 
73; socialist fallacy regard- 
ing, 86 

Proudhon, 54 

Publicity of costs and profits, 
85, 123-124, 126, 132 

Redmayne, Sir Richard, 149 
Reformation the, 10-13; effect 

on society, 12-14 
Reform Bill of 1832, 69 
Religion, 10; changes in, 11-12 
Report of the United States 



Industrial Commission, 1916, 
128-129 

Riches, meaning of, 98 

Rights of Man, French Decla- 
ration of, the, 16, 52 

Rights, and Functions, 8-19; 
doctrine of, 21 et seq, 43-44; 
without functions, 61 

Rights of the shareholder, 75 

Royalties, 23-24, 62 

Royalties, and property, 70; 
from coal mining properties, 
88; a tax upon the industry 
of others, 89 

Sankey, Justice, 115, 117, 143, 

165, 167, 168, 169 
Security of income, 73-75 
Service as a basis of remunera- 
tion, 25, 41-42, 85, 133 
Shareholders, 91-92 
Shells, cost of making, 124-125 
Smith, Adam, 15, 52, 95 
Social inequality, 36-37 
Social reorganizations, schemes 

for, 5 
Social war, 40 
Socialism, 53 

Society, duality of modern, 135 
Society, functional organiza- 
tion of, 52 
State management, 116, 117 
Steel Corporation, 116 
Supervision from within, 151 
Syndicalism, 130 

Taxation, 22 

Trusts, Report on, 23 

United States, transformation 

in, 65 
Utilitarians, the English, 17 
Utility, 16-17 

"Vicious Circle," the, 43, 123- 

138 
Voltaire, quoted, 55 

Wages and costs, 131 

Wages and profits, 78 

Wealth, acquisition of, 20 et 



188 



INDEX 



seq.; as foundation for pub- 
lic esteem, 35-36; distribu- 
tion of on basis of func- 
tion, 77 ; fallacy of increased, 
42-45; how to increase out- 
put of, 147; inequality of, 37- 
38; limitation of, 36-37; out- 
put of, 37-38; production 
and consumption of — a con- 
trast, 77-78; waste of, 37-39 
Whitley Councils, 110 



Women self-supporting, 74 
Worker and Spender, 77-78 
Workers, collective respon 

bility of, 154 
Workers' control, 128 
Workmen, as " hands," 15f 
present independence of, l'^ 
146; responsibility of c 
stroyed, 153-154; servants 
shareholders, 136-137; treat 
ment of. 152-153 



ri 




nil 



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